Hudson's Bay Co. HBAYF

BNN interview - November 16th

[las5513]

https://www.bnn.ca/video/money-manager-land-buildings-being-muscled-out-by-white-knight-fourth-player~1262017

[seatleslim]

That guy come across has extremely sharp and intelligent, though it would be nice to have a article that focuses on and spells out the dilution.  HBC has provided no information on what they are receiving in return for issuing new preference shares with unique protections, and all the benefits of the common stock at nearly one third of a real estate NAV estimate that the company published

[las5513]

The comments on Stockhouse are generally made by retail shareholders and in this case the retail shareholders do not approve of the recent preferred stock issue because of the dilution aspect. Since all shareholders own the same common shares it stands to reason all common shareholders are being diluted equally including the Bakers. I would like an explanation why the Bakers would knowingly dilute

[2j3kl]

This post has been removed in accordance with Community Policy

[las5513]

Hey 2j3kl do you seriously think the Teachers Pension Fund would stand by quietly and take a haircut, taking HBC private at a low ball price, if this real estate is actually worth $35. The guys running the Teachers Pension Fund are smarter than you or I so I'll follow whatever they do. Teachers Pension Fund has enough clout in the finance world they could make damn certain HBC couldn't

[seatleslim]

Three of Ontario Teachers top 5 holdings are Macerich, Sprint and HBC.  MAC alone is a 1.5 billion position out a total portfolio assets of 8 billion.  The position was accumulated between late 2014 and mid 2015. They are likely down 25% on that position alone.  Those three positions account for 25% of the portfolio. Never met any of them so I have no basis to say they aren’t

[las5513]

Since my wife is a retired teacher she regularly gets a report on the TPF and I can assure you the people running the pension fund are knowledgeable investors.

[seatleslim]

Fortunately for retired teachers Ontario only a small portion it’s $175ish billion in plan assets are internallly managed actively. Don’t expect the returns to deviate materially from typical benchmarks.  The relatively tiny “relationship investing” sub-fund which appparetnly holds HBC looks like it has awful performance though it is not broken out. Over 20% of the assets have been invested

[las5513]

Your point is well made.

[seatleslim]

I would also note a conflict of interest not yet cited by Litt. That Cadillac Fairview is a wholly owned sub of Ontario Teachers   The portfolio has numerous Hudson’s locations. It would be impossible to understand stand how the conflict is being managed, but they certainly have interests that go beyond that of a beneficial owner with basic total return objectives.  

[frankstevens17]

The reason HBC went for the preferred stock deal and subsequent dilution may be no more complex than the fact money was not available from any other source as not everyone believes the real estate value is in the $35 a share range.