P&O Preference Shares

[Robbie34]

I see in today's Daily Telegraph that the new owners are offering 120 pence per share for current shareholders to forego their rights to cheap crossings, or 100p plus a new unit to continue with their rights.

I'm sure I'll take the latter if it materialises.

[sueyh]

When we were shareholders we often found that non-shareholders could get a better deal on early booking.  We therefore sold our shares about 5 years ago. 

 

Suey

[^o)]

[Loiseau]

I think I'll keep mine - or enough of them to get the discount - just in case, though I haven't used them for a few years either.
Gosh, the shareholders' pack that crashed through my letterbox today is complicated though.  I'm trying to get my head round the essentials, so as to send back the right-coloured forms.  [*-)]

Angela

[Martin963]

My pack crashed through the letter box yesterday too and my understanding of the situation is as robbie34 describes.   As far as I can see one is losing one's right to vote (because one will no longer have shares in the company) but £1 per share in compensation doesn't seem too bad (maybe I'm being naive here).

The worry is that the new company (which seems more of a merger than a takeover..?) will divest itself of ferries pretty quickly in which case the continuing "scheme" might become pretty useless..

All seems very sad that a company can manage to do so badly running a service over what has often been described as the world's most expensive stretch of water (as far as ferry charges are concerned).  Personally it seems to me that P&O Ferries lost the will to live some years ago,  if you up the prices on the Le Havre route by 15% a year,  then put them up overnight by 40% you probably don't really believe you'll retain many customers do you?   I do miss that route but even from Devon itbecame far cheaper to go round via Dover,  and nicer (now we do it) for the cats, overall.

Perhaps Will TC could advise us (me certainly please) as to what it all means in PRACTICAL terms...?

[Will]

In practical terms, nobody knows how the new owner intends to run the ferry side of the business or how it will turn it round to be profitable. Least of all do we know what will happen in terms of fare structures or shareholder discounts. Your assessment is perfectly correct.

[Martin963]

Thanks Will.  I do hope you will keep us up to date - please;  expertise in fields like this is hard to come by and I'm sure I'm not the only one to appreciate your comments over the years.

[Robbie34]

My pack also arrived yesterday.  One problem on the yellow form is the size of the print: it's so small I can barely read it.

I've had my money's worth from P&O over the years so I haven't lost any money on my shares.  I've had them since the days of European Ferries so I intend to accept the £1 per share and retain the new units. 

You never know, there may be changes that will prove useful.  I don't use the Dover route as I hate the journey down the M1 and M25.  I had no option in October when I returned as the Le Havre crossing had finished.  It took over seven hours to cover 298 miles. 

[DavidSteward]

I order to qualify for the discounted fares I bought 600 shares about 5 years ago at a cost of £1000. Am I correct in assuming all I am being offered is either the £1.20 or £1.00 options?

In which case I have made a loss as it has usually better to take the special offers as opposed to the Shareholder's offers.

David

[Jc]

When did the shares go up to £1.66;if I'd seen them that high I would have sold you mine.

[Robbie34]

There is a wide spread between the buying and selling prices of P&O Preference Shares.  The current bid price is 95p and the offer 125p.  Some years ago the offer price was in excess of 180p but you would have only been paid 150 if you sold them.

[Alcazar]

[quote user="sueyh"]

When we were shareholders we often found that non-shareholders could get a better deal on early booking.  We therefore sold our shares about 5 years ago. 

 

Suey

[^o)]

[/quote]

That's true, we found it to be so for a long time, and seriously thought of dumping the shares.

Then last year, they seemed to see the light, and assured shareholders that it wouldn't be so..........certainly, I tried using, and not using shares, and each time, using them WAS cheaper, even if only a couple of quid.

Alcazar

[Jc]

Particularly after "Compass points" and their like were terminated.

[Martin963]

Yesterday's 6.00 pm Radio 4 News said that P&O shares (the ords presumably) had jumped on news that P&O might become the subject of a bidding war.

Does this mean that we should put on hold sending back the voting papers for Concessionary Shares?   ie if someone else launches a proper bid (rather than the merger as presently planned) do the concessionary share elections become invalid?

[Will]

Yesterday's Lloyds List said that PSA International of Singapore has trumped the Dubai Ports bid for P&O by 6%. Today's edition confirms that "P&O’s shares were propelled to a new high yesterday as the stock market grew confident that a bid battle for the UK ports group is in prospect between Singapore and Dubai."

So definitely hold on to those shares for now. At last some good news for P&O shareholders. Whatever happens to the ordinary shares should be reflected in the value of other stock.

 

[Martin963]

Thanks Will!

What is so frustrating is that most of us shareholders (I would imagine) bought the shares not to make a fast buck,  but to benefit from the concessionary fares.  P&O have let us down badly by managing to mismanage (if you see what I mean) the whole Channel operation so badly;  I would far prefer someone to take over,  leave the concessionary share scheme as it is,  and then run the operation efficiently for the benefit of passengers and staff alike.

Can't see that happening though.....

[Robbie34]

There has been no change in the price of P&O 5.5% Non Cum Prf shares.  The bid price is still 100p and the offer price 125p. 

[Jc]

A lot of people obviously,having read these fora?,don't understand the difference between ordinary shares and preference shares.

[Martin963]

Whilst no expert on corportate finance,  what I was asking was whether it was now pointless to take part in the votes concerning the concessionary shares,  because any result might be invalidated were a bid for P&O (rather than a merger) to be the final outcome.   I imagine that Will in his reply was following my line of thought.

But in the same vein,  surely (apart from at redemption) preference shares might (for whatever reason -  scarcity,  accrued advantages etc) be subject to market forces and therefore rise or fall from their nominal values.....?

[Will]

Certainly Martin, I was thinking of shareholders delaying making a decision until after the expected bidding war.

I am no financial expert either, but surely if any share has a value that can go up and down, a takeover battle like this can only increase its value, even though there has been no formal increased offer to shareholders as yet?

[Ciel Bleu]

We have already returned our voting papers and concessionary share certificates to P&O having opted to sell for 100p and retain the option to have 1 concessionary unit per share if available once a takeover has been decided. The date by which this all had to be received was January 26th (or thereabouts), and the implication was that our shares could become null and void if we hadn't returned them by that date, as the only 2 choices were to sell for 125p and forgo any rights to reduced ferry fares or the option that we chose above - I hope someone will correct me if I'm wrong. We're happy with our decision because we've had our moneysworth in reduced ferry prices for the last 12 years.

According to this link our concessionary shares are worth 112.50p today, it's the deferred stock that is increasing in value, at 500.00p as I type; http://portal.pohub.com/portal/page?_pageid=71,217793&_dad=pogprtl&_schema=POGPRTL

My father bought concessionary shares over 20 years ago, and had the option every year to not receive the annual cash dividend but to change them into the same value of deferred stock - he's now onto a winner but not us unfortunately!

 

Caroline

 

[Martin963]

I'm not sure that the shares become null and void (at least I hope not!);  I think it merely is the case that if one doesn't vote one may find that the ultimate decisions taken by everyone else become binding on one (eg one might be forced to take the full cash offer of £1.20). 

We shall see - I'm going to delay sending my forms back for a few days....

Laters:  In fact I see from that link you very kindly posted that the Court Meetings and Shareholder meetings have been postponed for a couple of weeks......

[Ciel Bleu]

I've just received my letter in the post this morning from P&O explaining about the new bid from PSA International, the adjournment of the January stockholder meeting for 2 weeks and it also says  "Stockholders may continue to submit the Forms of Proxy and Forms of Election which were distributed in relation to the offer by DP world. Forms of Proxy will be valid for the adjourned meetings. Stockholders will be given at least 14 clear days notice of the new time and place of the adjourned meetings"

It says the new approach by PSA 'may' lead to an offer to acquire deferred stock for 470 pence cash per unit and an offer for the concessionary units (no price is mentioned for these), and the cancellation of preferred stock on terms similar to the terms made available by the Dubai offer.

It looks as if we're all doing the right thing by getting our forms and certificates in the post.