Monday, October 22, 2007

Investor Relations Case Study: Wesfarmers Takeover of Coles

The 19.7 billion Australian dollar takeover of Coles Group by Wesfarmers is an interesting case study on Investor Relations.

It is a complex deal with Wesfarmers offering existing Coles shareholders a choice and mixture of shares and cash for Coles shares.

Wesfarmers is offering Coles shareholders’ protective shares. Many people are very curious to know what I think of this and whether this a good/bad thing for Coles and its shareholders?

From an Investor/Shareholder view:

I can't really see it as too much of a bad thing especially if they are paying for the puts. From the point of the view of a shareholder you are essentially getting that downside protection for free. However Wesfarmers would have to pay for that protection which they would have to expense so overall I think the value there is neglible.

From an IR view:

It is very clever because it reduces the perceived risk in a falling market and market volatility.

The only downsize, is investor communications is expensive and often confusing because it is quite complex.

Coles has a large shareholder base of small retail ‘Mum & Dad” investors because of their original discount card (eg: you got a discount at their supermarket and retail outlets if you were a shareholder) so communicating the message to this largely unsophisticated group is complex and difficult.

They later phased out the discount card claiming it was too expensive to administrate. See my original article here on shareholder discount cards.

What both Coles and Wesfarmers have done well is set up 1300 information lines for confused shareholders to call and speak to a real person.

Even though the lines are staffed and run by a call centre, and you speak to a call centre person who works off a script, you still get to speak to a warm body and a real live person.

My wife is an investor in Coles, so I've seen first hand all the investor communications and it has been first class.

Our action will be to accept the offer and take as much Wesfarmers stock as we can.

I've always believed in the Wesfarmers story because of the quality of management and their success with Bunnings retail hardware.

Two important points. I studied Wesfarmers as a case study in my MBA in 1997 and loved the story but never took action to invest.

I love renovating old houses and have been a Bunnings customer for nearly 20 years. I love their range, quality and service. From a marketing perspective, their advertsing and promotions are first class.

So this deal ticks all the boxes for me. You make up your own mind and seek independent professional advice because I am not qualified or licenced to offer investment advice.

1 comment:

look said...

愛情公寓, 情色, 舊情人, 情色貼圖, 情色文學, 情色交友, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 色情遊戲, 情色視訊, 情色電影, aio交友愛情館, 色情a片, 一夜情, 辣妹視訊, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊, 視訊美女, 美女視訊, 視訊交友, 視訊聊天, 免費視訊聊天室, 情人視訊網影音視訊聊天室, 視訊交友90739, 成人影片, 成人交友, 本土自拍, 美女交友, 嘟嘟成人網, 成人貼圖, 成人電影, A片, 豆豆聊天室, 聊天室, UT聊天室, 尋夢園聊天室, 男同志聊天室, UT男同志聊天室, 聊天室尋夢園, 080聊天室, 080苗栗人聊天室, 6K聊天室, 女同志聊天室, 小高聊天室, 情色論壇, 色情網站, 成人網站, 成人論壇, 免費A片, 上班族聊天室, 成人聊天室, 成人小說, 微風成人區, 色美媚部落格, 成人文章, 成人圖片區, 免費成人影片, 成人論壇, 情色聊天室, 寄情築園小遊戲, AV女優, A片下載, 日本A片, 麗的色遊戲, 色色網, ,嘟嘟情人色網, 色情網站, 成人網站, 正妹牆, 正妹百人斬, aio,伊莉, 伊莉討論區, 成人遊戲, 成人影城,
ut聊天室, 免費A片, AV女優, 美女視訊, 情色交友, 免費AV, 色情網站, 辣妹視訊, 美女交友, 色情影片 成人影片, 成人網站, A片,H漫, 18成人, 成人圖片, 成人漫畫, 情色網, 日本A片, 免費A片下載, 性愛, 成人交友, 嘟嘟成人網, 成人電影, 成人, 成人貼圖, 成人小說, 成人文章, 成人圖片區, 免費成人影片, 成人遊戲, 微風成人, 愛情公寓, 情色, 情色貼圖, 情色文學, 做愛, 色情聊天室, 色情小說, 一葉情貼圖片區, 情色小說, 色情, 寄情築園小遊戲, 色情遊戲情色視訊, 情色電影, aio交友愛情館, 言情小說, 愛情小說, 色情A片, 情色論壇, 色情影片, 視訊聊天室, 免費視訊聊天, 免費視訊, 視訊美女, 視訊交友, 視訊聊天, 免費視訊聊天室, a片下載, aV, av片, A漫, av dvd, av成人網, 聊天室, 成人論壇, 本土自拍, 自拍, A片,