Forum Archive Index - October 2001

["george souros" <g_sourous@hotmail.com>]

Nice to see Chalkie in the latest edition of the Independant concurring with 
my view re the value of PRG and why Cullen/Watson is so keen to get his paws 
on it. One of the very interesting things with this attempted  takeover is 
how Cullen has now come out so aggressively against the Independant 
Directors and Managements projected budget. You would have to assume that 
Management themselves aren't happy with Cullen's offer, as it does not 
reflect the hard work they've done over the last 3 yrs, and they,ve told 
Anderson (the Independant Valuers) the real figures of which Cullen has 
wanted kept quiet. It's not often in this country we see Independant 
Directors/Management standing up to Majority Shareholders so we have to 
assume there's more to this than meets the eye and that there's  a lot more 
rounds left in this fight!
With reference to Gaynor,s article in today,s Business section (NZ Herald) 
and that the  minority shareholders should maybe follow the lead of Cullen 
and his other friendly directors, and accept their original offer, it is a 
well known fact that Mark Hotchin (PRG Director) and Watson are best of 
mates and that the same Hotchin is 50% owner of Elders Finance with Watson 
the other 50%. No doubt he will be "rewarded" for siding with Watson in 
offering his stake at the low price. I note Hotchin as well, is the same 
person who was nailed for insider trading a couple of years ago. I would not 
be following his actions but more importantly I would be following the lead 
from the Independant Directors and indeed the Management who I understand 
have substantial option packages themselves. Management are the people who 
know what they can and cant deliver. Watson/Cullen/Hotchin are far too 
conflicted in this matter for shareholders to be taking their lead. Be 
interesting to see what other major shareholders ie AXA will be doing.
My gut feeling is that if Cullen backs down now he loses too much "face" and 
does his already tarnished reputation more damage. I think he,s bound to 
come out with an increased bid which would no doubt be at the lower end of 
Anderson,s Range ($2.16). Even this is bargain basement type pricing to grab 
100% of PRG but maybe if he does this we will have a bit more belief in that 
he,s trying to clean up his act and the "Wild West" image the NZSE has,of 
which Watson has contributed to in the past.
I dont think the Bear thought his prey would struggle so much!!!

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