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Gym, Cricket Pitch, 5 a side footy pitch, county grounds for walking around, and already half empty from the recent layoffs
If the HQ has flagpoles and a fish tank then this is probably for the best! It’s probably even more profligate than that.
Probably a significant overhead and a good opportunity to cut operating costs. I'm staying long.
Do we think they're really going bankrupt?
As predicted here by Stallion, Tempsford Hall up for sale.
Looks like a fire sale doesn't it?
Bod will be the only one left with a pay check
No MBO but they had over 50 enquiries to the sale of KL and it’s been whittled down to 4... an offer won’t be long
CStallion, An MBO is indeed a possibility, however I suspect the business is too far gone and most of the senior management team could be painfully aware of this. An added factor is that an MBO would have to be fully financed due to the fact that virtually all those participating will have lost not insignificant amounts via the employee share save schemes and options etc. Maybe a classic instance of good money after bad?
I know little for sure, but i've heard bits.
1. KL will be bought out by management, one if the most profitable parts of the company,the lower the sp, the cheaper they can do that.
2. Sale of KL will leave Kier with even less profit & ripe for a take over. ( I would not see it as a sale of KL, but the other way around in an orchestrated fashion.)
3. Sell what assets cost the most to hold onto& run, Tempsford Hall being one of them.
lemmink I have reached a not dissimilar conclusion. I don't expect any massive drama (either good or bad) but I do think there will be a gradual but significant rise, even if my target is a bit lower than yours. Only time will tell, but I am happy sitting on my holding here for the forseeable future.
Pressure will be on the board to explain by the AGM how they define the "sales process" as "progressing well".
Does that mean a bid has been made?
Smurfducker. I agree with point 1. Although I am astonished that the Veriterio as COO and an Executive Director from the old regime who arguably presided over the groups acquisitions is still in post. So as well as getting rid of competent personnel they are also keeping the less so! This and the fact that none of the non executives have gone apart from the chairman over the last 12 months is worrying. The chairman is not the only one who should take the bullet for this board, will they get re-elected at the AGM?
2. The CEO’s restructuring according to the plan must continue and at pace. I am sceptical it can be achieved as this is a behemoth of a company and one that has had very little experience of change management in the last decade so the resistance to change will be intense. Are the leadership capable of delivering the plan on time; everything out of Kier is so slow.
Disposals is a worry. The intense focus on debt by external stakeholders has been going on for over 12 months and what have Kier sold to address this in that time? A few properties and a business in Australia last year... No news on Kier Living or Kier Property divisions months after the formal announcement to sell. It’s all taking too long that I think it must be unsellable if by now no update can be announced.
3. The bad news will be dependant on failing to deliver on their own plan. Managing the news will be as always; as slowly as possible and couched in as positive language as possible with huge amount of effort in trying to sweeten the pill. Honesty and clarity would give confidence that the nettle has been grasped.
A take over by an acquisitive group (foreign especially with a weak £) is IMO a likely option down the road when inroads into debt reduction materialise and a direction of travel can be seen. The group is undervalued if it has a viable future, when its future looks secure the SP will be slow to respond ( shorters on board and Woodford as a major shareholder) that will be the point when potential suitors will investigate. For the time being Kier is on its own to sort out its own mess.
My guesses for the future are that the KL disposal will not take place because utilisable taxed losses make it more valuable to the group than to a potential buyer without utilisable taxed losses (I am not a tax expert so may be wrong about that?).
The balance sheet will be worked back to health over a 5 year period - by retaining earnings generated (without being smashed to pieces by exceptional bad stuff any more!) and those earnings will sufficient to justify a share price of circa £5 by then.
Discounting £5 by 5% pa for five years (time value of money discount) gives a present value (excluding risk) of about £3.80 I think; so the current share price of £1.17 appears to me to be offering a discount of roughly 70% to intrinsic value for risk.
In my opinion the risk is front loaded and so should start or has started to diminish with time.
Here’s my take on what the next steps will be with Kier.
1 Continued major cost cutting - as per the Previous regime, Andrew Davies is continuing to ditch the experienced and competent personnel for the green and enthusiastic wannabes who embrace the pro company propaganda which in itself smacks of continued desperation
2 Announcements relating to cost cutting orientated around operating centres. (Perhaps including the disposal of some of the few assets that Mursell, Dew, Veriterio et al failed to cash in on...
3 The ”managed” release of more bad news regarding the financial situation (a la BB a few years ago) over the next 12 months
IMO Davies is preparing Kier for either an Interservesque pre pack administration or (if he can find a foolish party soon enough) a sale of the whole business
For those of you still heavily into Kie I wish you luck, you’re gonna need it!