Comments on: Taiga Building Products notes http://divestor.com/2009/12/04/taiga-building-products-notes/ Canadian Finance, Economics and Securities Analysis Thu, 09 Feb 2012 16:39:18 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Sacha Peter http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-5095 Sacha Peter Wed, 27 Oct 2010 20:12:59 +0000 http://divestor.com/?p=3195#comment-5095 Well, all I can say is that the market obviously disagreed with my take on the situation, but as Warren Buffet said, "there are no called strikes in Finance". But the people that picked up the notes for cheap (especially below 50!) must be laughing now since they are sitting on pieces of paper that are giving off incredible yield. That said, the company is still over-leveraged and my capital will not be going anywhere near it, especially at current price levels. Well, all I can say is that the market obviously disagreed with my take on the situation, but as Warren Buffet said, “there are no called strikes in Finance”.

But the people that picked up the notes for cheap (especially below 50!) must be laughing now since they are sitting on pieces of paper that are giving off incredible yield.

That said, the company is still over-leveraged and my capital will not be going anywhere near it, especially at current price levels.

]]> By: Rick Drysdale http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-5094 Rick Drysdale Wed, 27 Oct 2010 19:57:53 +0000 http://divestor.com/?p=3195#comment-5094 Screaming buy,,,,,, I have been watching this for a while, they just got refinanced. I will be buying at 97 this week. Wish I wasn't such a weiner and bought at 47 ish. It's interesting looking at these comments after a year has passed. Screaming buy,,,,,,
I have been watching this for a while, they just got refinanced. I will be buying at 97 this week.

Wish I wasn’t such a weiner and bought at 47 ish.

It’s interesting looking at these comments after a year has passed.

]]> By: Sacha Peter http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3915 Sacha Peter Fri, 18 Jun 2010 07:35:55 +0000 http://divestor.com/?p=3195#comment-3915 I just checked this company again. The chairman owns about 19% of the company and there is another significant shareholder and director owns 39%, both of them from Malaysia, so that is effective joint control of the company. I don't know who owns the notes, but you can infer from the annual financials that 53% of these notes are held by this same group of people, so yes, it probably was a monetary extraction. In their recent quarter, they declared a 9 cent dividend (based on 25% of their last year's earnings) and given their debt levels of some $231 million, this is financially insane. They do have a $102 million line of credit at the end of March 2010 outstanding, which expires in September 1. Presumably anybody with any financial sense at all would be charging a high rate, since this company has "insolvency" written all over it. I'm amazed the equity is even trading over a dollar. I just checked this company again.

The chairman owns about 19% of the company and there is another significant shareholder and director owns 39%, both of them from Malaysia, so that is effective joint control of the company.

I don’t know who owns the notes, but you can infer from the annual financials that 53% of these notes are held by this same group of people, so yes, it probably was a monetary extraction.

In their recent quarter, they declared a 9 cent dividend (based on 25% of their last year’s earnings) and given their debt levels of some $231 million, this is financially insane.

They do have a $102 million line of credit at the end of March 2010 outstanding, which expires in September 1. Presumably anybody with any financial sense at all would be charging a high rate, since this company has “insolvency” written all over it. I’m amazed the equity is even trading over a dollar.

]]> By: Sam http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3914 Sam Thu, 17 Jun 2010 21:16:49 +0000 http://divestor.com/?p=3195#comment-3914 If you really look into the situation, you will find that the majority shareholder is the Chairman. You will also see that the notes were issued just subsequent to said person becoming a significant shareholder. Guess who is making money here? If you really look into the situation, you will find that the majority shareholder is the Chairman. You will also see that the notes were issued just subsequent to said person becoming a significant shareholder. Guess who is making money here?

]]> By: Taiga Building Products resumes interest payments - Divestor http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3329 Taiga Building Products resumes interest payments - Divestor Fri, 15 Jan 2010 00:00:21 +0000 http://divestor.com/?p=3195#comment-3329 [...] building products has resumed paying interest on their notes. I have written about the notes earlier and pointed out the risks associated with the notes. At that time the notes were trading between 45 [...] [...] building products has resumed paying interest on their notes. I have written about the notes earlier and pointed out the risks associated with the notes. At that time the notes were trading between 45 [...]

]]> By: Sacha Peter http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3246 Sacha Peter Fri, 18 Dec 2009 21:09:37 +0000 http://divestor.com/?p=3195#comment-3246 Let's put it this way: if you anticipate that they'll get paid off whole, they're a screaming buy. I don't see it happening that way. Let’s put it this way: if you anticipate that they’ll get paid off whole, they’re a screaming buy. I don’t see it happening that way.

]]> By: Grant Marshall http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3244 Grant Marshall Fri, 18 Dec 2009 01:19:56 +0000 http://divestor.com/?p=3195#comment-3244 The notes were issued in 2005 and some of them were bought back in 2006. I believe Taiga management didn't expect these notes to exist as long as they have. The economy got in the way of a lot of companies plans. When I look at the notes they don't look that bad today. Someone's been making money between April and now. http://cxa.marketwatch.com/tsx/en/market/quote.aspx?symbol=tbl.nt Grant. The notes were issued in 2005 and some of them were bought back in 2006. I believe Taiga management didn’t expect these notes to exist as long as they have. The economy got in the way of a lot of companies plans.

When I look at the notes they don’t look that bad today. Someone’s been making money between April and now.

http://cxa.marketwatch.com/tsx/en/market/quote.aspx?symbol=tbl.nt

Grant.

]]> By: Sacha Peter http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3243 Sacha Peter Thu, 17 Dec 2009 23:50:13 +0000 http://divestor.com/?p=3195#comment-3243 Sorry Grant, you are correct, I was confused with reading my own notes and shouldn't write comments while distracted. Anyhow, replace "prinicpal payments" of my previous comment with "$27M of accrued interest payments due on the notes on September 1, 2010". Although this isn't $129M, if you were giving the credit facility to the company, I don't think you'd be comfortable giving that much cash to the second-in-line creditors. Sorry Grant, you are correct, I was confused with reading my own notes and shouldn’t write comments while distracted.

Anyhow, replace “prinicpal payments” of my previous comment with “$27M of accrued interest payments due on the notes on September 1, 2010″.

Although this isn’t $129M, if you were giving the credit facility to the company, I don’t think you’d be comfortable giving that much cash to the second-in-line creditors.

]]> By: Grant Marshall http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3242 Grant Marshall Thu, 17 Dec 2009 23:45:44 +0000 http://divestor.com/?p=3195#comment-3242 The principal payments on the notes are due Sept. 2020, not 2010. That's over a full decade away. Grant. The principal payments on the notes are due Sept. 2020, not 2010. That’s over a full decade away.

Grant.

]]> By: Sacha Peter http://divestor.com/2009/12/04/taiga-building-products-notes/comment-page-1/#comment-3241 Sacha Peter Thu, 17 Dec 2009 22:54:19 +0000 http://divestor.com/?p=3195#comment-3241 Grant; if the credit facility is renewed, the company still has to deal with the principal payments on the notes. They clearly don't have enough money to do that, and if you were the provider of money on their credit facility, do you want to fork over another $129M? I wouldn't. Grant; if the credit facility is renewed, the company still has to deal with the principal payments on the notes. They clearly don’t have enough money to do that, and if you were the provider of money on their credit facility, do you want to fork over another $129M? I wouldn’t.

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