Global Investments

actually, I am talking about "AVOCA CLO VII PLC"

Quote:The Overcollaterisation test headroom is currently 0.06%. A breach of the test would result in cash flows being diverted to pay down Class A
notes and interest payments to GIL’s investments would be shut off until the breach has been remedied. The Reinvestment Diversion test has
currently failed by 0.44% which would impact on interest payment to Class G because 50% of excess interest is expected to be reinvested in
collateral rather than fully distributed to Class G noteholders

Although I can't fully understand all the term used, I can guess, the interest payment can be gone at any time.

but the carrying value of this investment is still GBP 7million

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personally, I think GIL is more for a punt to hope for recovery of its investment in short term. I don't really believe it is a value buy in the long term. Most of its investment are extremely risky.

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among all its investments, personally, I think its US RMBS is the most safe one because it is a discounted buy on senior tranche. discounted junior tranche is just too risky, especially under current circumstance, often junior tranche can be either make a little or lost it all. of course if it is 1 cent on the dollar and still can receive coupon, it could be a value buy for junior tranche.

(28-08-2011, 01:55 PM)freedom Wrote: actually, I am talking about "AVOCA CLO VII PLC"

Quote:The Overcollaterisation test headroom is currently 0.06%. A breach of the test would result in cash flows being diverted to pay down Class A
notes and interest payments to GIL’s investments would be shut off until the breach has been remedied. The Reinvestment Diversion test has
currently failed by 0.44% which would impact on interest payment to Class G because 50% of excess interest is expected to be reinvested in
collateral rather than fully distributed to Class G noteholders

Although I can't fully understand all the term used, I can guess, the interest payment can be gone at any time.

but the carrying value of this investment is still GBP 7million

---

personally, I think GIL is more for a punt to hope for recovery of its investment in short term. I don't really believe it is a value buy in the long term. Most of its investment are extremely risky.

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among all its investments, personally, I think its US RMBS is the most safe one because it is a discounted buy on senior tranche. discounted junior tranche is just too risky, especially under current circumstance, often junior tranche can be either make a little or lost it all. of course if it is 1 cent on the dollar and still can receive coupon, it could be a value buy for junior tranche.

They had already impaired GBP 7 mil in previous years. I believe the Avoca Notes are classified as Available for Sale Financial assets which would imply a secondary market elsewhere.

2Q Report:

Quote:AVAILABLE FOR SALE FINANCIAL ASSETS
As at 30 June 2011, Available for Sale Financial Assets increased to S$26.4 million from S$24.9 million as at 31 December 2010 owing to higher market valuation for Avoca VI M note and Avoca VII G note. The increase was partially offset by drop in the share price of Fly Leasing Limited.

Over the past 12 months, STAM has been disposing small portions of their legacy assets and sought to purchase US RMBS Notes and CLO Notes (of varying interest yield). They do have significant cash left to make further purchase in a poor market. So far, STAM has avoided the highly risky junior tranches and turning to debt and I think this is a good thing judging by how B&B strategy of buying junk tranche (using debt) blew up in late 2008. STAM repays its debts as well.

Ultimately, this is a high risk investment and I wouldn't recommend it to anyone even if the yield seems high. A lot of uncertainty in the economic climate.

GIL ANNOUNCES 3Q 2011 RESULTS

http://info.sgx.com/webcoranncatth.nsf/V...D0037F053/$file/24a_20111103ResultsAnnouncement3Q2011.pdf?openelement [Press Release]

http://info.sgx.com/webcoranncatth.nsf/V...D0037F053/$file/24b_20111103SGXQuarterlyReport3Q2011.pdf?openelement [SGX Report]

http://info.sgx.com/webcoranncatth.nsf/V...D0037F053/$file/24c_20111103CurrentAssetReview3Q2011.pdf?openelement [PPT Slides]

http://info.sgx.com/webcoranncatth.nsf/V...D0037F053/$file/24d_20111103DividendGuidance2H2011.pdf?openelement [2H 11 Dividend Guidance]

3Q 2011 results reflects the deteriorating credit market in Europe and the volatile forex exchange rates. B/S remains steady with net cash of $10.5 million. A dividend guidance of 0.75 SG cents was announced for 2H 11 which (if declared) would bring FY 2011 dividend to 1.50 SG cents (or $8.26 million). This compares well with 9M 11 operating cash-flow (less interest expense and debt repayment) of $7.12 million. No breakdown of revenue was given for 3Q 2011. Not too certain when the CLOs will start to generate cash-flow - perhaps in 4Q ? In the press release, it mentioned that the Manager is seeking shareholder's approval to review its investment policies and more details will be out soon. Overall it is a highly risky investment and I wouldn't classify it as a yield stock since the dividends are not very defensive (as evident by history).

(Vested)

seems like we are the only 2 out here that have time for this stock haha.

GIL SGM on 5th December 2011:

(1) THE PROPOSED ALTERATION TO BYE-LAW 82 TO EXPAND THE COMPANY’S INVESTMENT POLICY;
(2) THE PROPOSED ALTERATION TO BYE-LAW 34 AND THE PROPOSED INSERTION OF A NEW BYE-LAW 34A IN RELATION TO THE PURCHASE BY THE COMPANY OF ITS SHARES; AND
(3) THE PROPOSED ADOPTION OF THE SHARE PURCHASE MANDATE.

http://info.sgx.com/listprosp.nsf/bc9c2d...5000d8683/$FILE/GIL-Cir.pdf [Circular]

(Vested)

If approved, and management starts buying more common and liquid securities like corporate equities and bonds, it would be one step closer towards erasing BBSF's original proposition of providing a platform for investing in complex and high-yield securities and derivatives...

Nick, will you be attending the SGM?

(24-11-2011, 07:05 PM)D123 Wrote: If approved, and management starts buying more common and liquid securities like corporate equities and bonds, it would be one step closer towards erasing BBSF's original proposition of providing a platform for investing in complex and high-yield securities and derivatives...

Nick, will you be attending the SGM?

I am not too sure. Have to see how my schedule is like closer to the day itself. STAM deals with CDOs so I don't think that they will shy away from it. But I guess this might very well be the final nail on the coffin from the operating lease segment. Overall, a positive move and I do support it. They do have $28 million cash to invest in this proposed class of assets so let's see what they have to say in the SGM (or in subsequent reports). And hopefully some diversification towards Asia.

Hi Nick,
Many of our investments/interests seem to overlap! - MIIF, First Reit, VICOM, CMZ..
GI is another one - although i have divested and learnt some lessons from the loss.

Just FYI.

For those interested in understanding more about the aircraft leasing business, there are some useful information from Ascend and AVAC.

Ascend: http://www.ascendworldwide.com/

AVAC: http://www.aircraft-values.co.uk/

These are well-known consultants that industry players sometimes use.

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With regards to GIL's two aircraft, I would say that the current lease rate of US$160K for each plane is considered quite cheap compared to other aircraft. But this is mainly due to their age and the fact that there is an ample supply of 757-200s out in the market now. Also, it seems that at the time the current lease was signed in 2003, lease rates were bottoming out in the industry. Going forward, it should not be too difficult to maintain the current lease rate, but perhaps not for too long since the aircraft will already be 20 years old when the current lease expires in 2013. (Most aircraft get retired or converted after 20 years old; SIA doesn't use aircraft older than 15 years I think)

RESULTS OF SPECIAL GENERAL MEETING HELD ON 5 DECEMBER 2011

http://info.sgx.com/webcoranncatth.nsf/V...D00350A47/$file/26_20111205ResultsOfSpecialGeneralMeetingon5Dec2011.pdf?openelement

Anyone attended the SGM ?

(Vested)