Monday, July 04, 2011

Why Don't I Give Bumi Armada A Break?

From the posting

  • brotherlone said...

    c'mon... give mr AK a break

    bumi armada had to leverage up to more than 3.0 times D/E to acquire those assets.

    what will investors if it goes up to 3.0 times, it will be sold down immediately.

    a fast growing company needs to gear up.. and it needs patient capital.


C'mon.... bro.... so who's EVER gonna give the poor minority shareholder a break?

Ever think about it this way?

Why should we look from that side of the.... grass?


I know where I moo from.

I am of ONE of the small minority investor in the Bursa Malaysia.

Just a small cow in the grassland.
A small cow who asks who's gonna speak for the minority shareholders who weren't given a chance to see their investment in this company 'morphed from a small, domestically focused company into a major international offshore service player'?

That's all I interested.

Sadly I know that is past history.

And I am just a tormented lost cow speaking of past injustice.

And again I stress I am not the least bothered to know how this IPO will perform. Will it go up? Will it go down? Sorry I am not bothered.  And I am not writing to ask anyone who wants to try their luck to buy into this IPO. Please, buy if you want to. It's your money and don't let me stop you..

And seriously, I own no vodoo stick that can put a curse on a stock. Serious lah. Curses don't work lah.

All I know is what had happened before.

I know.

There... I have spoken yet again on Barmada.

Good luck with you on this IPO.

Tons of shares being offered.
May you make your money.
Peace with you.


brotherlone said...


please dont get emotional...

very simple, if you think its undervalued and is trading at a steep discount at a high conviction, why didn't the market or you accumulate more and bid it up? for a better upside

they took a bet that the commodity cycle will last, and sure it did and BAB grew. if you share the same view, go look for alternative plays, plenty around, SBM Offshore, MISC (not really)..... etc.

what i'm trying to say is that, Bumi Armada will not be able to grow at such pace if it remain listed. Why, because cost of capital will be more expensive, of course it is... their effective interest rate is only 4% (check their prospectus). would you expected him to do a rights at 10x PE and dilute himself?...

if he does a private placement, then yes you can say he's not giving you a chance to participate....

lets talk about tanjong plc as an example, it has been trading below fair value for ages, before it was privatised. when the offer came, investors both insti and retailers complained it was too little.

only way to extract value is to break up the company, hence AK took it private. the sum of the parts was actually greater than the whole for tanjong plc. they had issues with the RTO and it is becoming more apparent and is dragging its sum of parts lower.

er free float is only 30%, and its oversubsribed, im afraid i can't get any shares myself... its not true to say that theres tons of shares available. ... only 79m shares out of its 2.9b share base.

just dont get emotional lar when trading... its always easier to lay the blame on someone or something else

"Getting sore at the market doesn’t get you anywhere.”
-jesse livermore

cheers... and please be easy on industry analyst lar, i can tell you 90% of the sell-side analyst dont have vested interest lar, most of the time its over-sights

Edwin said...

Good day
I would wish to have an exchange link with your blogs. Your blog is an inspiration to us..

Moolah said...

Brotherlone: LOLOLOL!

No. I am actually have zero emotions about all this.

Are you?

If you don't mind indulge in me for a moment...

Someone (who did not know who I was) actually refered my blog postings on Bumi Armada.

They were marketing and they weren't happy on what was written.

I just kept to myself.

For they were just marketeers.. just trying to sell the share and comments like mine... were considered as annoying noises.

Yes.. this is how it is.

In the market.. they just don't want to hear the OTHER opinion. Isn't that sad? ( LOL! I know.. that's a silly Q!)

That's how sad it is.. really.

I wondered... why can't they think what had happened?

So simple.

Barmada had growth. 25% growth. And what did they do? They had the guts to tell the minority shareholders back in 2003 that Bumi Armada was in a tough industry with a very uncertain future. Hence privatisation was the better option for the minority shareholder.

Obviously, common sense, suggest it was all hogwash cos the company had 25% growth! Yes, they dared to make such an insinuation!

And look at Barmada today.

Barmada has 'morphed from a small, domestically focused company into a major international offshore service player'?

And how much was Barmada taken private?

7 times earnings.

And what do I call this?

Injustice to the minoirty shareholders!!!!

So could Barmada grow to what it is today?

Well... I see your arguement... but let me ask you a simple question... why couldn't the minorities shareholders back then given a CHANCE?

Yes, why weren't they given a chance?

Look, they took the risk to be a minority shareholder, yes? Surely they are entitled the option to continue to their investment risk, yes?

By privatisation.. the owners took that option away from the minority and with the threat of delisting, the minority shareholders were forced to liquidate their shareholding due to the delisting threat. And how were they paid? 7 times CURRENT earnings.

Current earnings and they assumed the growth died!

And how much are they valuing now? HL is using 17x earnings based on 2012 earnings. A two forward earnings - with a 25% growth included in the calculation! ( Life sure is good! )

And this is injustice!

And this is plain message I am sending out.

And just for your information, my views today is EXACTLY the same as back in 2003 and even 2007.

Yes check out this old posting in 2007:

Are my comments consistent then and now?

And here's the interesting thing.... look at the comments back in that 2007 posting and compared to the ones I got recently.


Yeah.. I know... but that's life.

ps: 79.8 million shares for the 'public'. If this is not a chunk... then.. lol... it's not a chunk!

ps: MSM, Eversendai.. how many shares did the Msian public get?

Moolah said...

Edwin: Your link is up.