Reading the Zeitgeist

What do child-care centres, gold and the online service industry have in common? Renewed investor interest, and lots of it. A bunch of big transactions made by substantial shareholders over the past week reflect this and mirror the investor zeitgeist.
MIR Funds Management has made a big play, forking out $163 million for 5% or Lihir Gold. The Prospector is always interested in the activities of managing director Michael Triguboff, a well-known value investor (click here).

A year ago today, Lihir Gold was trading for $1.01. Today it closed at $3.41. Lihir Gold has certainly run a long way over the past 12 months and MIR’s purchase means Triguboff thinks it has some way to run yet.

News Limited’s announcement that it had acquired a further 10 million shares in Travel.com.au on May 9 represented the formalisation of its arrangement with netus, a technology investment company backed by News. This comes on top of an additional eight million shares purchased by netus on April 21. Travel.com.au was trading for 14¢ on April 6; it closed today at 35¢.

The wringing of hands that accompanied any mention of Miller’s Retail late last year has finally ceased. A year ago Miller’s Retail hit a low of 67¢ before beginning an at-first unsteady return to health. Merrill Lynch’s announcement on Friday that it had bought more than two million shares provided further proof that the retailer has turned the corner. It closed today at $1.70.

The same day, Merrill Lynch announced it had sold 14 million of its 23 million shares in DCA Group earlier this month; DCA Group made an announcement of its own: that its second half year profit would be at the lower end of its $40–50 million forecast. It was promptly punished by investors, who wiped 72¢ or 19% off its price. It closed at $3.00.

Also that day, Colonial First State announced that it had increased its holdings in Eddie Groves’ ABC Learning '” purchasing 8.5 million shares for $63 million. The group now holds 6.78% of the multinational child-care group.

The diversified Futuris Corporation announced it has increased its holding in Integrated Tree Cropping from 53.5% to 55%. A former Holmes a Court lieutenant and one-time chief executive of Futuris, Alan Newman, remains a director of Futuris, which retains interests in Elders and Australian Agricultural Company.

There has been some activity in the property trust market over the past week. UBS Nominees went short in Reckson New York Property Trust, offloading 3.4 million shares. Meanwhile, Suncorp Metway has seen some potential in Babcock & Brown Japan Property trust, increasing its holding by three million shares at a cost of $6.1 million.

Perpetual and Westpac have taken opposing views on publishing company Funtastic, the holders of distribution licences for both The Wiggles and Disney merchandising. Perpetual announced it had picked up more than 1.2 million shares in Funtastic on May 8, increasing its holding from 7.42% to 8.42%. On May 9, Westpac lightened its load, selling 360,000 shares. The following day Funtastic announced its purchase of Australian DVD distributor Madman Entertainment for $34.5 million.

Data supplied by News Bites. For more information, go to: www.newsbites.com.au