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Our Investments – Past and Present

The Prudential Investment Company of Australia Story
(London City owned 20%)

As the owner of Body Corporate Services, the largest strata unit manager in Australia, Prudential was attractive to London City. In 2003 London City acquired a 20% shareholding. It was keen to increase this shareholding substantially. However, the key overseas shareholder, rather than selling, made a takeover bid for Prudential, successfully acquiring the company after a number of bid increases. Although this long term investment became short term, the gain to London City shareholders was significant.

The CCI Holdings Story
(London City as largest shreholder owned 16%)

Asked to support a rights issue in 2004, London City was forced to take Board representation in late 2004, funding adverse cash flow at the time. Following a further rights issue in 2005 and the appointment of new senior management, CCI performance improved significantly, assisted also by the company’s strong market positioning and the resources uplift. Moving from a market capitalisation of around $8 million in 2003, CCI was ultimately acquired by a leading French international group in June 2007 for close to $80 million.

Fiducian Group Limited
(London City currently owns 7.0%)

London City bought its first shares in Fiducian in 2006. Fiducian celebrated in 2016 its 20th anniversary as an active participant in investment / financial sector, vertically integrated with a full range of services. Led successfully by Mr Indy Singh and his team Fiducian has exceeded past records in 2018 with profits up 21% to $10.5 million.

Excelsior Capital Limited
(8% owned as part of the groups 12% holding)

Excelsior Capital arose from a mixed diversified group. It is now a Listed Investment Company (LIC) with an investment portfolio and a key asset being 100% owned electrical product supply company (CMI) that has branches across Australia. This electrical business has prospered in recent years. Excelsiors dividend payout is poor - with surplus funds retained for growth.

Other Past Investments

Holyman Limited.- sold in 2000

In the late 1990s this marine company experienced major losses and its share price fell from $5.00 to 35 cents and new management installed. London City recognised the company as a long term low cost “buy”. Within six months two transport groups fought a takeover battle for Holyman, the final price paid was $1.08 per share. London City assisted the Holyman defence.

Tranzact Financial Services Limited – 8% owned until taken over in January 2014

London City became interested in Tranzact some six years after that company became part of the New Zealand Grosvenor group. In 2012 London City underwrote for Tranzact its Dividend Reinvestment Plan and became a significant and supportive shareholder. In late 2013 Grosvenor opted to bid for the 40% ownership not owned. London City rejected the price and sought Takeover Panel support, ultimately accepting the offer.

Penrice Soda Holdings Limited – 8% then sold off in 2012-13

During 2008 London City acquired an 8% “cornerstone” investment in this Adelaide group with the support of its Board. . Within six months serious issues became apparent and attempts to gaion board representation failed. The company has collapsed and went into liquidation in 2014. Some $270 million was lost by investors and the banks. London City is pursued legal action in the Supreme Court of NSW against the Penrice auditors, Ernst & Young and a confidential settlement took place in late 2021.

Coffey International – 2% sold in 2016

A growing shareholding was being acquired in this international engineering service and development aid management group that was undergoing resuscitation. Investment sold in early 2016 by a takeover for a 50% gain.

Cash on Deposit

An important part of London City’s strategy is not to risk capital losses by always placing monies on deposit with organisations offering tempting high interest rates. London City’s cash funds are held by leading Australian trading banks at safe, but realistic, interest rates.