ACE.b DFS spinning off income trusts

[selkirk]

ACE.b
Air Canada low $21.05 high $42.53

since 1999 have posted a few times about Air Canada. in 1999 was bullish on Air Canada. there was a few reasons for buying the stock back then
1. low oil price (also they were trading at a low pe) though they locked in much higher oil price.

as the hedges came off they would make even more money.
also a strong economy.

anyways the company went on a good run, mainly thanks to a take over attempt by Onex.

Air Canada fought off the takeover attempt by buying Canadian (did this for political reasons,long story). AC took on to much debt and was then a sell.

In one of the year end predictions thread when AC was over $6 thought they would go to zero within a year. it went bankrupt in two years, just to much debt and 9-11 and SARs did not help.

also weak management. but AC ussually has that problem.

However now own ACE.b (Toronto) avg. price $39.50, like the stock in the short term because it has gone up on the spinoff of Aeroplan income trust ipo.

the IPO will raise around $287 million but there is demand for $500 million maybe more (30%).
the yield for the trust will be 7.5%

hope to get half of my order filled on the income trust....
anyways believe ACE.b may hit $45+ on the positive spinoff.

Aeroplan is the biggest Air Rewards program in Canada and they are looking to expand.

ACE.b also may spin off their maintenance division in an income trust.

ACE.b is a short term play, not a long term investment.
the airline business would be great if you did not have to fly


DFS $31.25 $46.37 Toronto currently $39.05
Bought the reamaing Iron Ore producer Quebce Cartier Mining.

DFS is a well run steel company, the opposite of Stelco.

anyways DFS will sell a portion of the trust in a (you guess it) income trust).

own DFS; have increased the position, believe the stock will go up when they do the income trust ipo.

maybe $42-$45.

thanks
selkirk

 

[selkirk]

DFS is at $39.05 Ace.b $42.53

thanks
selkirk

 

[selkirk]

updated these two stocks in anothter thread but cannot find it...so

DFS takeover price has increased to $68 from $63.

Thyssen Krump has increased the bid to counter a bid that is expected from Arecelor. Both are large European Steel companies.

the bidding has basically toped out but will hold on until the end, just in case it goes a few dollars higher.

DFS is a great steel company and a very good return for 6-7 months.

IPS Ipsco great company fully valued, Algoma watch. Stelco Steel is still a terrible company and if you own the stock take the .20 cents and run.


Air Canada is spinning of Jazz regional airline. Air miles worked out, and they may spin off the maintenance division in an income trust.

high load factors. the stock is down from my $42.53 and trades in a $38-$40 range...still holding for now.

if it hits $36 will reduce my position.

thanks
selkirk

 

[baby johnson]

thanks sellkirk

 

[selkirk]

BJ in the predictions thread you asked about a good financial or energy play. a few have been listed on here, would look for a regional US bank that is well run and has a habit of raising divs, and earnings every year.

BNS (scotia bank), BMO bank of montreal, CM CIBC, TD TD bank, Royal Bank, are all cdn. banks that trade in the us.

we have an election and some people believe the conservatives will get in minority or majority and will allow bank mergers.
they will get in but will not allow bank mergers and the hype will come out of these stocks. (may allow insurance.bank mergers)

will look for energy jr. that trade in the US and cdn.


Arecelor raised bid to $71.. this is fun, price is rich, but hoping the bidding does not stop until $75 cdn.

thanks
selkirk

 

[selkirk]

just a quick note; the cdn. banks I listed above are good long term investments but hope they trade sideways before add to the positions.

most would rate holds.

thanks
selkirk

 

[selkirk]

time to wrap up these trades
ACE.b Air canada
got stopped out of ace.b at 36.50 now at $36.22 going to use the lower and closing price for record purposes.

the stock has not been acting well mainly because oil is going higher. also labour and managment are fighting again like only they can. will wait, thought the stock would get a bigger bounce from the income trust spinoff of jazz (regional airline).

loss 7.247%

DFS sold 75% of my positon as the end is near as the price is sitting at $72.70 takeover bid is at $71cdn. will keep the remainder 25% just in case it hits 75cdn.

gain +70.93%

note DFS paid a div did not figure it in since that could go toward paying the commission in both trades.

overall gain on plaing the parent companies of the income trusts spinoffs 63.68%.

the money will go to cash and hope for more of a sell off. in jan have written (sold ) put options on Suncor and Tailsman, and TEck. would have been better just buying them put for options 15-20% out of the money like the premiums.

thanks
selkirk