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Strategies & Market Trends : Value Investing
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To: Spekulatius who wrote (26925)6/14/2007 12:10:44 AM
From: Spekulatius  Read Replies (1) of 78625
 
I think found a cheaper way to buy into MPEL via Hongkong:
finance.yahoo.com
melco.hk.cn

Market cap of MELCO (HK)=1.228Bshares x 11.5=14.1B HK$
subtract net cash of about 1B HK$ and EV value is 13.1B HK$ or 1.675B$ US$
Besides net cash Melco (HK) owns roughly 41% of MPEL. MPEL market cap is 4.95B$, so 41% are worth 2.03B$. In addition we have an assortment of other businesses that do 170M$ in HK$ of EBITDA/year.

So it looks to me that by acquiring Melco (HK), I get a participation in MPEL at a 17.5% discount plus as a wildcard some other businesses for free. Since Hongkong does not have a capital gains tax there is no tax liability if Melco (HK) decided to sell MPEL. I hope my math is correct. I bought a position in 0200.HK tonight and tomorrow morning i will sell my starter position in MPEL. Net of my impending sell of MPEL i will double my bet in Melco.
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