14:40 Rock the casbah
Ayatollah Khomeini must be spinning in his grave.
Mark Stephens, at Blackstar Capital Partners, compares Iran
with a nightclub.
(The Ayatollah, you may recall, banned broadcasting of any
music rather than Muslim ditties on Iranian radio and television in 1979, the
same year he was named “man of the year” by Time magazine.)
“Iran was like the best nightclub in town,” says Mr Stephens,
speaking of investment in the country following the lifting of UN sanctions
“Everyone was lined up and dressed to go.”
“But it never happened,” Mr Stephens says, amid a discussion
on trade finance, and flagging too the cloud that Donald Trump, the US
president, placed over Iran on a trip this week to the Middle East.
Where is Blackstar investing instead?
The aim has shifted further south from Iran, with Mr Stephens saying that “we are very
interested in the GCC countries,” ie the Gulf of Arabia nations such as Oman,
Qatar and Saudi Arabia (which is, of course, more popular with Mr Trump too).
“Banks there are constrained as they are here, but the non-bank
sector is not as well developed,” so offering opportunities.
12:35 Green ham and
How’s this for investor logic?
The world’s supplies of farmland look extremely tight, if
the world is to meet the increased population needs of 2050.
In terms of getting calories to consumers, it is far more efficient
in terms of plant matter, than meat.
So the answer is to promote vegetables grown in the ocean.
“Ergo, the future of food is seaweed,” says Michael Moore.
As well he might as a member of the advisory board at Seamore, which processes
seaweed into the likes of pasta and, um, bacon.
That is, bacon of a green colour historically associated
with cuts left languishing at the back of the fridge for a few months beyond
the best before date.
Still, that does not seem to putting everyone off. Sales of
the product have “gone ballistic”, Mr Moore says.
So much so that the company is being tested to source enough
seaweed, from the likes of Ireland and Brittany, and has a “challenge
persuading people to put on their waders and pull the stuff out of the sea”.
Which is one reason why Seamore (not the first weed seller
to be started by a Dutchman, methinks) is raising some E2m.
The verdict of Roberto Viton, managing director at Valoral
Advisors? “To be selling food before lunch is very smart”.
11:45am: Some things
best kept private
If ag groups are losing patience at the cheapness of their
shares, maybe they should exploit the situation by buying the stock themselves,
says Skye Macpherson.
Asked about the weak valuations attributed to farmland
companies, she says that “going private would be a really good idea”.
Some of them are trading “at a 50% discount to the value of
their land”, she says, implying easy gains from a buy-out.
But wouldn’t the ag sector miss the loss of a swathe of its listed
Apparently not. Ms Macpherson says that “we have a lot of
companies to choose from, in different regions, different subsectors” when it
comes to buying ag sector shares.
“We do not have a lack of opportunities.”
Indeed, she highlights some new ones, with the spin-off of
an ag-only group from the Dow-DuPont merger, and the growth of FMC Corp into a
scaled-up agrichemicals group.
More on ag sector consolidation from Skye Macpherson,
director, natural resources at investment giant BlackRock.
“What the level of mergers and acquisitions shows is that
companies operating in this industry see value at the levels.”
Indeed, Glencore’s approach to Bunge, revealed overnight,
looks “a reflection that Bunge is trading on so low a price-to-book ratio”.
09:00am What to make
of Glencore approach to Bunge?
For some reason, big news in ag always breaks when Agrimoney
is having a conference.
This time, it is Glencore’s revelation that its part-owned
ag division has made an “informal approach” to trading giant Bunge. (What made
it informal? Were the Glencore suitors not wearing ties?)
To one senior delegate at Agrimoney LIVE, this looks like
the latest episode in the consolidation wave that started in seeds and
chemicals, with the rash of tie-ups with DuPont-Dow, ChemChina-Syngenta,
Bayer-Monsanto and BASF, um
And could it be a sign that the ag sector is on the up
“It looks a sign that sector valuations are attractive, if there
is all this consolidation going on,” the delegate says, flagging the dent to profits
in sector from the decline in crop prices.
There is more on sector MA scheduled in the Agrimoney
LIVE programme. Stay tuned.
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