John Linton
It seems to me that I take much longer to make decisions lately than at any previous time in my life. It would be nice to think that is because of a belated maturity or that with advancing age comes greater wisdom - but I actually think its because I'm far less well informed these days on many key subjects and my mind is far less incisive than it used to be. Too much alcohol over the decades has obviously depleted the available 'little grey cells' to dangerously low levels. Unfortunately, whatever the reason(s) may be, it/they are coinciding with a time when the decisions are becoming bigger, more serious and more dangerous.
I thought through what the well presented 'M and A adviser' discussed with us last Friday morning which, in summary, didn't tell me anything I didn't already know in basic detail though he added some 'colour' to the various scenarios. In fact I think we already knew more than he did - or a more likely scenario would be we knew more than he was prepared to let on. Either way we gained no new information but undoubtedly added considerably to the information he wanted to know about Exetel.
While we have access to some money we firmly told him they we aren't in any way interested in buying other businesses based on my repeated observation that no buyer of "distressed assets" or to use an even more mealy mouthed phrase - "synergistic assets" in the communications industry has ever benefited from their acquisition. This left him with the other half of his business - our interest in selling Exetel. To which our response was - equally negative unless he could find us a Soul and a David Teoh type payment - then we would be mildly interested.
So we then enjoyed an interesting 40 minutes or so sharing (or more likely only partially sharing) our respective views on the various transactions that occurred over the past few years and our, somewhat divergent, views of the current status of the four possible 'acquisitors' that he knew that we knew he could possibly have in mind. I publish my basic views of all the ISPs he could have had in mind but we had an amusingly scurrilous time sharing some less restrained views of incidents and the people involved over the past few years - sort of a bar conversation after three drinks but without the drinks loosening the control.
We had a few laughs at our mutual views of business practices and personal characteristics of the people at Eftel and dismissed that kluge of failed businesses as being within a heartbeat of disappearing. Our views of Optus and their 'over lords' were similar as were our views on Internode and iiNet. His views on TPG were a little different to mine as he has no personal knowledge of the people there but we shared a deep respect and admiration for the Soul/TPG 'sale' transaction and both shared the same view as to why the SPT/TPG entity was presiding over the demolition of its share price since the 'merger'.
So over the past 48 hours I've thought about why he wasted almost two hours of his time (plus the travel time to and from the CBD) to talk with our small company. There could only really be two reasons. The first, and most likely, would have been that he had run out of real 'deals' and was 'prospecting' at much lower levels that he was accustomed to deal at. The second, less likely reason, was that he had been given a list of companies that some putative buyer had in mind as possible acquisitions and he was making initial approaches to gauge the level of availability (and gullibility) of the prospective targets. I also wondered why I had allowed a 30 minute meeting to go for almost two hours - not at all like me.
As far as I can see there is only one company in the current marketplace that would have the money, and the slightest realistic interest, in buying even a small company like Exetel and we have rejected their approaches twice over the past 18 months and certainly don't need the assistance of a 'middleman' to reject any further 'advances'. So, from our point of view it was a waste of time except that it was an enjoyable chat.
However, as we decide whether we should invest more money into Exetel (either to buy our own CBD premises or to fund HSPA hardware and leasing or any of the other 'opportunities' that are on our minds at the moment) I suppose last Fridays chat was a reminder that we also need to consider exactly what Steve, Annette and I want to do with the next five years of our lives and what is in the best interests of ourselves, our employees and our customers before Exetel gets to a size (if in fact it ever does) that severely limits those decisions. By investing over $A2 million in a property for Exetel would ensure that we would have to commit ourselves to the next few years which would rule out any 'sale' of Exetel as would any significant UK investment.
I don't expect to hear anything back from the very pleasant visitor because, despite my obvious incompetence in almost every area of business, I think if we ever decided that we would investigate the sale of Exetel I would send 3 - 4 emails to the only organisations I would consider selling to (and who might have the amount of cash we required to part with the results of many dedicated years of our lives).
One more iteration of 'planning' for eventualities that are improbable but need to be considered - but not at all seriously right now as there are too many other time demands at the moment.