Vote on Friday for sale of part of their business for...

Vote on Friday for sale of part of their business for $900m......pay day end of Jan - for this 1.2b FPO share/ market cap 500m company). Hard to find very nice opportunity with this stock.....my view.


Maple Brown Abbott buying probably the last of the Lazard shares on the 4 Jan......very likely came after discussions and dilegence, direct with Sigma management, by this usually consersative funds manager.

Maybe even the initative came from Sigma management, via an approach to MBA to buy out Lazard (sort of thing happens all the time)

Whatever, that big purchase by MBA....so close to this coming Fridays vote.....and soon to be announced special dividend - is a significant development, to my way of thinking.

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Somewhat surprising and very positive for a much above consensus capital return dividend , is the fact Sigma will restrucure their existing $320m syndicated bank loan, such that a new loan will be struck, but STILL carrying some $150 to $200m debt. (source disclosure document)

also ....part of the $900m tax free sale proceeds will go to pay off a "significant" part of the $510 Sigma Rewards securitised loans.

That may still leave the company with about $400m cash (oe 38 cents per share - current share price 41.5 cents)

No 1 shareholder in the company ORBIS have made it clear they are seeking up to 35 cents in the form of a special divident......and it seems likely, based on the companies own reporting, that amount could be afforded.

Payment of $500m of their loans....would reduce interest by $40m (they paid $73m interest in the last 12 months)........ so make what left of the business probably justifing its present market capitalisation (thus the payout a one-off bonus, means the share price would stay the same after the dividend)

The company has spoken of some $200m in existing accumulated franking credits (thats about 18 cents per share).....I suspect a dividend of 18 cents may be closer to the mark......18 cents is still well above current market beliefs. Hopefuuly like for a big share price gap up (similiar to RHG Home Loans- a few weeks, when they surprised)