Little Professor over at HPC asks whether TPG have a deathwish.
Per their balance sheet, TW have plant & equipment and cash/cash receivable worth £614 million and liabilities of £3,964 million. All the other crap like 'intangibles', 'goodwill', 'deferred tax asset' and so on is worthless, let's assume.
The company's market cap as at this afternoon is £369 million.
To acquire this company, you'd thus have to pay £4,333 million to shareholders and lenders, you can realise £614 million from cash/cash receivable, so your net cost is £3,719 million. Let's write down 'development and construction costs' by 25% for a quick sale, that's another £1,500 million coming in, net cost £2,219 million.
What you're left with for your £2,219 million is the land bank, with a book cost of £3,879 million.
Per the 2007 preliminary financial statements, they have 42,460 plots with detailed planning in the UK and 40,789 in the USA. Let's assume the USA ones are of negligible value, that means the UK plots must be worth about £50,000 each - or three times as much as Barratt's land bank.
Hmmm. So either TPG have a deathwish or they know something that nobody else does.
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2 comments:
Nice breakdown of the figures
Perhaps they are betting on the state engineering a shit load of inflation to bail themselves out of their debt?
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