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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Snowshoe who wrote (24904)	11/2/2002 8:31:46 PM
From: TobagoJack	Read Replies (1) \| Respond to of 74559

Hi Snowshoe, <<opinion on this approach to investing in China?... The Best China Play Could Be Taiwan>> I just finished reading that article before seeing your post and had thought, 'gee, if I want to invest in China, I would invest in China, as opposed to China via Taiwan, or Beijing by way of Hong Kong'. I know Taiwan publicly listed companies that are siphoning their Taiwan assets offshore to invest in China and elsewhere, some to the extent of defrauding (maybe this is too strong a word) their Taiwan based insurance and finance subsidiaries to accomplish the task. Should China economy grow, and Taiwan companies benefit, even as Taiwan people losses jobs, who would be buying Taiwan's shares? It is not as if Taiwan corporate governance and financial accounting deserves a premium over what is available on the Mainland? So, no, no Taiwan for me. I did get these leads from the Barron's interview: "... Aida Engineering has a 3.2% yield and cash in excess of its market cap ... Okumura, a construction company, has net cash, is breaking even and is yielding 2.4%. ... Ono Pharmaceutical and Daiichi Pharmaceutical both have a fair amount of cash on the balance sheet for which the market is giving them no credit … have discovered their own drugs and market those drugs in the U.S. and Europe … in terms of enterprise value, or market cap adjusted for net cash, it's clear the businesses are trading at very low multiples of operating income. ... We've been accumulating shares of Pargesa, one of Belgian financier Albert Frere's holding companies. Pargesa has three major assets, two of which are listed. They have a stake in the oil company TotalFinaElf, in the French water company Suez, and their third, unlisted holding is in the German media giant Bertelsmann, which is supposed to be listed two or three years from now. When we do a sum of the parts for those three major assets, we come up with an intrinsic value of Pargesa that is almost twice the current share price. To top it off, Pargesa pays a dividend that yields 3.4% in Swiss francs. ... It's particularly attractive because we get a double discount. In other words, Liberty Media has a stake in AOL Time Warner, a stake in News Corp. and a stake in Vivendi Universal, and not only are those parts trading at depressed levels, but the holding company is trading at a discount, and so we get the combination at a discount. ... Q: Are there any other sectors in Europe you are partial to? De Vaulx: We are always intrigued by companies that have voting and nonvoting shares outstanding, especially when we see the nonvoting shares trading at a big discount to the voting shares. One we've been buying in the past six to nine months is an Italian company called Italcementi. They have a stake in Cement Français and they have their own cement operations, mostly in Italy. The discount to intrinsic value is at least 50%, but the nice thing about the nonvoting, or savings, shares is that they pay a dividend with a yield of 5.7%. Q: Why the discount? De Vaulx: It's nonvoting stock, and the large institutional investors only care about the biggest stocks, especially those in the benchmarks, and neglect the savings shares." Message 18188085 These guys do sort of what I do, except they are not as good:0) Chugs, Jay