will we see a bounce, page-16

Might be worth noting p46 of the AFR today in street talk.

Sources say that Goldman Sachs and other investors are making moves to displace the Rubicon group as manager of RJT. It is reported that Galileo, and babcock and brown have been approached. Goldman Sachs own 12% of RJT. Also 12% of RJT's stock was turned over on Friday. Given the report in the AFR there is some chance Goldmans may have bought more in an attempt to push for a change of the RE. It would make this process easier if Allco were forced by margin calls to sell some of their RJT stock on Friday. Allco has 10% of RJT. But if they had to sell some of this, and Goldmans bought, then control may be shifting.

Galileo and Babcock and Brown have demonstrated that they can make a reasonable fist of managing a Japan property trust, as their discounts to NTA are a moderate 10-20%.

The real key though is for RJT to come up with some asset sales. The fact that Babcock and Brown in January recently sold about $70 mill AUD at very good levels gives a ray of hope. If RJT managed to do a bit over $100 mill in sale agreements over the next 2 months, and like Babcock achieved them better than their book value, suddenly RJT's problems don't seem that severe at all. The ultimate test of the 3 rubicons is whether their properties can really be sold at whay they are carrying them at on their books. I think the NTA's they reported could well be bullsht. I keep reading that properties in Europe and US could well be taking up to 15-20% hits this year not even accounting for if you are a distressed seller. Reports from Japan seem better but even there there must be a flow on effect as markets are so globalized now. Having said all that the 3 stocks still look too cheap. I just think you need to do your worst case numbers on selling some properties below what they have on their books. Remember the clowns who are in management. Take the NTA's with plenty of scepticisim. And remember NTA's can take huge hits when you are leveraged and a forced seller.

But I would have thought RJT just should try and agree to sell $120 mill AUD of properties in next 2 months, even if at 20% below their book vals ( a 5 cent hit to NTA?), surely this is achieveable and can solve their short term debt issues? This would be much better than a capital raising, I mean them mentioning an equity raising was that meant to be a joke by them?