IFT - Infratil

[Waltzing]

you missing the big picture here....

data centers on .... MARS...

law  of  diminishing returns.... more data , bigger centers... = law of bigger numbers...

[BlackPeter]

you missing the big picture here....

data centers on .... MARS...

law  of  diminishing returns.... more data , bigger centers... = law of bigger numbers...

Interesting point. It certainly would be cold enough there to save costs to cool down the servers - though, the heating costs might be considerable ...

Wondering as well about the signal delays - whats the time for one signal hop to the MARS and back? Maybe we need to slow down some of the transactions. Dr. Google says something like between 6 min to 44 min, depending on how Earth and Mars stand to each other.

But then, given that MARS is clearly the next US state after Canada, Greenland, Panama , Gaza, New Zealand and the moon - it would save them heaps of tariffs, wouldn't it?

They need to remodel their valuation methods and put a rocket under them.

[Basil]

Do Morrison refund the gigantic bonus that comes with this paper revaluation back to the company if the value tanks in the future?

[Dolcile]

Um... I don't get it.   Wasn't the sales process with market participants so a reasonable basis to estimate Fair Value. 

[Left Field]

Crikey.......at a time when we hear of a slowing or peak demand for data centres, this article argues the opposite........claiming many new centres planned in the USA that will be less environmentally sustainable..........

https://www.theguardian.com/environment/2025/apr/03/trump-fossil-fuel-donors-data-centers


"Trump's funders and backers are especially going to benefit from Trump's policies to restrict regulations in the AI sector as part of an attempt to outpace China to become the global leader in the sector. The US is currently home to just more than half the mega data centers in the world. And with Goldman Sachs suggesting $1tn will be spent on AI data centers in the next few years, a lot is up for grabs."

Interesting times.

[Basil]

What does Microsoft know that the small players don't ?
https://markets.businessinsider.com/news/stocks/microsoft-hits-pause-on-data-centers-raising-ai-demand-questions-and-stock-market-concerns-1034548291
One thing that is not in any doubt.  IFT has broken its uptrend and has been in a confirmed downtrend for months.  Who knows where it ends.... watching the TA and waiting as long as it takes for a new uptrend, makes a lot of common sense.

[Left Field]

Further to my post #319 above Kiora has posted an update outlining recent difficulties with gas powered electricity powered data centres in Texas.

https://finance.yahoo.com/news/texas-attempt-kickstart-gas-fired-140002983.html

Texas is a microcosm of a debate raging across the country over how best to meet rising demand for electricity, driven by the data center boom and the electrification of cars and factories. Data center developers need access to more electricity than current infrastructure can easily provide,....


Seems IFT's investments in CDC and Longroad renewable energy may be 'well positioned' after all.

[Left Field]

Further to my post #319 above Kiora has posted an update outlining recent difficulties with gas powered electricity powered data centres in Texas.

https://finance.yahoo.com/news/texas-attempt-kickstart-gas-fired-140002983.html

"Texas is a microcosm of a debate raging across the country over how best to meet rising demand for electricity, driven by the data center boom and the electrification of cars and factories. Data center developers need access to more electricity than current infrastructure can easily provide..." 


Seems IFT's investments in CDC and Longroad renewable energy may be 'well positioned' after all.

[BlackPeter]

Seems IFT's investments in CDC and Longroad renewable energy may be 'well positioned' after all.

...

Who knows, but lets face it - the fundamentals look very expensive (even for whoever believes in the valuations pumping the management fees), and clearly the market disagrees with being well positioned - it looks like more investors try to reposisition themselves away from this investment. The downtrend makes one shudder.

[Left Field]

Morrisons CEO adding another $2 mill worth of shares to his collection.

https://api.nzx.com/public/announcement/449722/attachment/441096/449722-441096.pdf

[Basil]

What a bloody rort and I'm not the only one who thinks so., emphasis added.  One last absolutly enormous rort, literally a few days before the bubble values of these tech assets bursts. Have to hand it to Morrisons, they have played Infratil shareholders like a bloody fiddle, (comment from a friend)

Morrison in line for $350m fee bonanza from Infratil
~4 minutes
The bonus follows a huge increase in the valuation of Infratil's stake in datacentre company CDC implied by a transaction announced last month.
Infratil CEO and Morrison partner Jason Boyes.
Infratil's management company Morrison is in line for a fee bonanza following the revaluation of Australia-based datacentre company CDC last Friday.
The NZX-listed company's investor relations manager Mark Flesher said although the fees were still being finalised the likely incentive fee due to Morrison for CDC would probably be about $350-$360 million for the year to March.
The fee, allowed for in Morrison's management contract, relates to a huge uplift in CDC's valuation in a share transaction involving CDC's existing shareholders.
On February 18 Infratil said it had bought a further 1.58% of CDC for A$216m from Commonwealth Superannuation Corporation, taking its stake to 49.75%.
Australia's Future Fund also bought 10.46% from Commonwealth, although its purchase price was not disclosed.
The transaction, due to close in the second half of calendar 2025, valued CDC at A$13.7 billion, implying a valuation for Infratil's stake of A$6.6b ($7.1b).
The valuation represents a $2.7b increase in the value of Infratil's CDC holding since March 2024.
CDC owns datacentres in Auckland, Canberra, Melbourne and Sydney.
'Enormous' fee
Independent analyst and former stockbroker Tony Morgan said the level of the fee was "ludicrous".
"These guys execute really well, it's just the number's got a bit big," he said.
"It must be the biggest single management fee ever paid. It's enormous."
Under Infratil's management contract with Morrison, the Wellington-based investment firm is entitled to 20% of the valuation uplift on CDC above a 12% hurdle rate of return, after adjusting for capital expenditure and distributions.
The highest previous incentive fee on CDC was $140.2m in 2021.
In the year to March 2024 CDC had revenue of $412.3m and net profit of $201.9m. Its net assets at balance date were $2.58b.
Previous valuations of CDC were estimated using discounted cashflow analysis, but the February transaction allowed a reassessment under a fair market value approach.
The fee due to Morrison is higher than the amount Infratil spent on its additional CDC shares.
Flesher told NBR Infratil had already outlined a $110.2m performance fee accrual for CDC at the half year, "so this would result in an increase of $240-$250m for the second half".
Announcing the deal at the time, Infratil chief executive Jason Boyes said CDC was one of the company's most successful investments.
"This increased ownership reinforces our commitment to investing in 'ideas that matter'," he said.
"It reflects our strong conviction in CDC and the powerful tailwinds driving digital infrastructure."

[winner (n)]

Lambton Quay chatter is thT  Infratil / Morrisons get sucked into the AI hype with their data centres and its not going to end that well for shareholders

[Mos]

What a bloody rort and I'm not the only one who thinks so., emphasis added.  One last absolutly enormous rort, literally a few days before the bubble values of these tech assets bursts. Have to hand it to Morrisons, they have played Infratil shareholders like a bloody fiddle, (comment from a friend)

Morrison in line for $350m fee bonanza from Infratil
~4 minutes
The bonus follows a huge increase in the valuation of Infratil's stake in datacentre company CDC implied by a transaction announced last month.
Infratil CEO and Morrison partner Jason Boyes.
Infratil's management company Morrison is in line for a fee bonanza following the revaluation of Australia-based datacentre company CDC last Friday.
The NZX-listed company's investor relations manager Mark Flesher said although the fees were still being finalised the likely incentive fee due to Morrison for CDC would probably be about $350-$360 million for the year to March.
The fee, allowed for in Morrison's management contract, relates to a huge uplift in CDC's valuation in a share transaction involving CDC's existing shareholders.
On February 18 Infratil said it had bought a further 1.58% of CDC for A$216m from Commonwealth Superannuation Corporation, taking its stake to 49.75%.
Australia's Future Fund also bought 10.46% from Commonwealth, although its purchase price was not disclosed.
The transaction, due to close in the second half of calendar 2025, valued CDC at A$13.7 billion, implying a valuation for Infratil's stake of A$6.6b ($7.1b).
The valuation represents a $2.7b increase in the value of Infratil's CDC holding since March 2024.
CDC owns datacentres in Auckland, Canberra, Melbourne and Sydney.
'Enormous' fee
Independent analyst and former stockbroker Tony Morgan said the level of the fee was "ludicrous".
"These guys execute really well, it's just the number's got a bit big," he said.
"It must be the biggest single management fee ever paid. It's enormous."
Under Infratil's management contract with Morrison, the Wellington-based investment firm is entitled to 20% of the valuation uplift on CDC above a 12% hurdle rate of return, after adjusting for capital expenditure and distributions.
The highest previous incentive fee on CDC was $140.2m in 2021.
In the year to March 2024 CDC had revenue of $412.3m and net profit of $201.9m. Its net assets at balance date were $2.58b.
Previous valuations of CDC were estimated using discounted cashflow analysis, but the February transaction allowed a reassessment under a fair market value approach.
The fee due to Morrison is higher than the amount Infratil spent on its additional CDC shares.
Flesher told NBR Infratil had already outlined a $110.2m performance fee accrual for CDC at the half year, "so this would result in an increase of $240-$250m for the second half".
Announcing the deal at the time, Infratil chief executive Jason Boyes said CDC was one of the company's most successful investments.
"This increased ownership reinforces our commitment to investing in 'ideas that matter'," he said.
"It reflects our strong conviction in CDC and the powerful tailwinds driving digital infrastructure."

This is definitely over the top and does not reflect what Infratil shareholders experiencing (with share price tanking). The incentive calculation methodology should be based on TSR outperformance not arbitrary valuations in my view.

[Left Field]

IFT & CDC's new Melbourne data centre open day presentation.

https://api.nzx.com/public/announcement/449879/attachment/441316/449879-441316.pdf

[BlackPeter]

IFT & CDC's new Melbourne data centre open day presentation.

https://api.nzx.com/public/announcement/449879/attachment/441316/449879-441316.pdf

Well, I guess given the $$$ they charge their shareholders in bonus payments one certainly should expect a nice presentation.