I am totally against the sale of Queensland's assets, the Port and the Freight Rail Business hitting the market already and already there are concerns about how people will take up the share offer in QR and how institutional investors will take their allocation and even that there will be a huge amount of unallocated shares that will have to be held by the government.
The Queensland Treasurer who has so far failed at all counts , losing Queensland's AAA credit rating, costing Queensland ratepayers billions in Amalgamated council costs and seeing the price of basic services like water more than double in some places is now on the back foot as usual defending the way the QR float is pushed mostly at mum and dad investors.
If as I predict nearly half the shares remain unallocated and the Qld Government has to hold them there is no doubt we will see a future "telstra 2" type offer so that investors who have lost money on the first share buy can lose again on a second buy.
One of the big worries is that the Qld Government under the Treasurer rejected an offer for a good part of QR that related to mining and offered a pretty good price for it. However the treasurer wants more and more cash and a full scale share offer was deemed the way to get it.
What worries me firstly is the share price, it will be close to $2.80 a share and that for what will be a public company with no forecasts of profit, no back up figures and no real value of asset base or projected costings, secondly the return dividends are down around the 5% mark or less and thirdly the ownership will be dominated by the government holding still even with a high amount of corporate allocation due to the skepticism of ordinary investors taking up the offer.
Personally, it is my opinion that the float is designed the way it is on purpose, to sucker in mum and dad investors, who will sell as the price drops significantly and allow corporate investors to buy back at low prices and therefore hedge some of their loss as the price comes back after a dumping, when the price comes back the Government which will still own up to 40/50% will have a second sell off and set in motion a second wave of the same scenario.
Corporate investors will be the winners the price will stabilize around the $1.30 and we'll probably then find out that the major holder are none other than the miners with the original rejected offer who have now bought up at a lower price and got a bargain.
Of course this is all conjecture and hypothesis, but as we wait and see, I'm not rushing out to bolster my portfolio with QR stock.
5 comments:
That is the byproduct of having a SMART Arse for a Treasurer. Amalgamations, Credit rating, profit turned into debt and all round smart alec, who actually believes how well he has done and whats more supported by Bligh and the other loser LUCAS. Whata front row to play with. Weak as P...s.
I bought into telstra on the strength of my financial planner's reccomendation, then into the second telstra offer, supposedly to move my get in price to an average of the two, I sold them all for a loss. I wont get fooled again.
And then theres talk of the Kimbies boy being groomed as the next Premier - God help us.
Anyone who falls hook, line and
sinker for this double dipping
the taxpayers afront would have
to have honeycomb for brains.
What Fraser and his political
pals at QR have schemed up is
no diffrent to trying to sell
the same property twice with
the same title deeds. It is
crooked stuff. QR is owned
by the taxpayers of Queens-
land, not by the government.
With the floods yet to be over and with rail being very badly affected in several places, the costs to shareholders has to be considerable to repair them. I'm glad I didn't buy them.
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