MCK - Millennium & Copthorne Hotels NZ Limited

[Mos]

MCK not the main show at the moment for lowballing majority owners. A case of Life Imitates Art in the "Succession Genre"...

https://www.reuters.com/business/city-developments-executive-chair-accuses-ceo-son-attempting-boardroom-coup-2025-02-26/

[BlackPeter]

MCK not the main show at the moment for lowballing majority owners. A case of Life Imitates Art in the "Succession Genre"...

https://www.reuters.com/business/city-developments-executive-chair-accuses-ceo-son-attempting-boardroom-coup-2025-02-26/

Not sure, this fight in the Kwek family is good or bad for MCK retail holders, but is certainly is interesting and relevant. Cheers for the link.

[Crackity]

Todays news -


In the biggest real estate transaction of 2025, NZX-listed landlord Precinct Properties has struck a deal to sell its new InterContinental Auckland hotel to Singaporeans for $180 million.

The landlord said today it planned to sell to Singapore Exchange-listed Hotel Properties, an established owner, operator and developer of hotels, resorts and shopping centres in 17 countries.

The buyer has interests in 41 hotels under various brands including InterContinental Hotels Group.

Scott Pritchard, Precinct's chief executive, said the Kiwi company bought the building in 2012.



The building has a rooftop bar and restaurant, while the new hotel has 139 guest rooms.

InterContinental's name has been here previously, on what is now Pullman Auckland Hotel, at the corner of Waterloo Quadrant and Princes St.

That building has been a Hyatt previously.

More than 100 staff work at the hotel, which links directly into Precinct's Commercial Bay shopping centre, alongside Whitcoull's.

Precinct said today that after the hotel sale settles, its committed gearing will reduce by around 3%.

This sale is consistent with Precinct's business strategy and enables the recycling of capital to ensure it is well-positioned to deliver on the next phase of its strategy execution.

"This transaction remains conditional only on subdivision being completed which is expected to be in Q3 2025. [After] completion of the subdivision, Precinct will retain ownership and management of the balance of the property not being divested at One Queen Street, with the hotel sale to include the office space on levels three to five," it said.

Real estate agency and consultancy JLL said it had brokered the deal.

"JLL has just closed the largest hotel asset sale in New Zealand," it said.

"This off-market transaction sets a new record price per key for NZ hotels. It marks Hotel Properties' first investment in the New Zealand market," the agency said.





Interesting that M Social ( freehold MCK ) has 190 rooms and is right in front of the harbour view of Precincts new development site ( being the extension of Comm Bay to the Viaduct).



Hmmmmm.....

[Stockgathering]

Very interesting, really shows how undervalued MCK is at the moment with a SP of $2.25

[Basil]

Very interesting, really shows how undervalued MCK is at the moment with a SP of $2.25

Agreed and thanks for the info Crackity. Discount to NTA is FAR greater than OCA AND this is a business with no debt and very strong cash flows with a bright tourism outlook.  No wonder this one is the subject of a takeover and OCA isn't lol

[LaserEyeKiwi]

Agreed and thanks for the info Crackity. Discount to NTA is FAR greater than OCA AND this is a business with no debt and very strong cash flows with a bright tourism outlook.  No wonder this one is the subject of a takeover and OCA isn't lol

I've been saying that for 5 years, and the price went nowhere. Sincerely hope for current investors that this time is different and underlying value will be finally recognized.

[Basil]

I've been saying that for 5 years, and the price went nowhere. Sincerely hope for current investors that this time is different and underlying value will be finally recognized.

Thanks.  At least it hasn't gone down.  OCA well under half what it was trading at 4 years ago. 

[Poet]

Seems that CDL Singapore has patched up differences, so hopefully we will get some resolution/progress on MCK bid

https://themalaysianreserve.com/2025/03/13/singapore-billionaire-kwek-drops-case-against-ceo-son/

and

We will all continue to focus on strengthening CDL's business, in accordance with good corporate governance, now and in the future, including completing the raft of landmark developments underway across Singapore and globally, furthering the expansion of various brands under Millennium & Copthorne, continuing our capital recycling initiative and above all, maximising shareholder value," reads the statement by Leng Beng on behalf of the board.

[Basil]

Encouraging, thanks for sharing.

[BlackPeter]

Yep, cheers for the update. Funny things happen in families.

I suspect however that this won't impact on the takeover process in NZ. Money at stake is pity cash for the Kweks, hardly worthwhile to bother the CEO or boardchair.

I assume they (some middle level regional manager) are waiting for the end of the offer period and might even hope that some people sign away their shares for the low ball offer. Some always do.

Then they will approach the larger holders (like e.g. ACC) and negotiate on a price with them. If they are successful, than this is probably what we all will get (remember - if more than 90 % of all shareholders agree to a price, everybody must sell at that price - and the Kweks hold already more than 70%).

Lets hope the respective ACC fund manager has a back bone and an incentive to show it.

[Basil]

Yes I would think negotiations are going on behind the scenes between ACC and other institutions and the Kwek family.
One would hope ACC managing a $50 Billion + fund and others will be guided by the independent valuation mid-point of $4.70 and tell the Kwek's to come back with a fair and reasonable offer or go away and stop wasting our time.

As you imply, they're only mopping up ~ 24% minority interests, it's not like it's a full takeover and they are the ones who only have a modest stake of 20% already, so I don't see any profoundly good reason why ACC or anyone else should accept an offer price materially below the midpoint of the valuation range.

For the first time, in many years I actually thought Northington did a bloody good job with their report.

My guess is we will see a revised offer in April / May but whether that's a good one remains to be seen.  Remember that Asian investors are well known to play the "long game" with negotiations to try and wear people down so it's important to be staunch and resilient.  I'm going to take a "very dogged" approach. 

[Poet]

Offer increased to $2.80 and is unconditional now

Still a joke IMO

[Poet]

They claim to have received acceptances for 2.8% of shares at $2.80. I can't see how they could go unconditional without reaching the 90% threshold required under the companies act.


Looks as if they have been granted an exemption to %%%% their minorities. Unbelievable

https://www.takeovers.govt.nz/assets/Exemptions/Takeovers-Code-CDL-Investments-New-Zealand-Limited-Exemption-Notice-2025.pdf

[Crackity]

They claim to have received acceptances for 2.8% of shares at $2.80. I can't see how they could go unconditional without reaching the 90% threshold required under the companies act.


Looks as if they have been granted an exemption to %%%% their minorities. Unbelievable

https://www.takeovers.govt.nz/assets/Exemptions/Takeovers-Code-CDL-Investments-New-Zealand-Limited-Exemption-Notice-2025.pdf

Says all the conditions have been satisfied ( ie OIO ) or waived ( ie - the 90% acceptance condition? )

They gonna take all they can at $2.80 but not necessarily get to 90% is my take on it.

They increase to $3 I reckon ACC and Milfies might cave and then it will be game over....

[Basil]

Less than I was hoping for BUT global macroeconomic factors need to be carefully considered.

I am really curious what you two guys make of the postings on the other channel about the huge discount to NTA CDL is trading at on the Singapore exchange ?

Suppose that doesn't really matter.  $2.80 is full and final offer this time and then they have stated no new takeover will be forthcoming within 9 months from 22 April 2025.

Hold out for a better price next year or take the money and run.  Hmmm