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Sims Metal Management Limited – FY10 Results
 
Event: Sims Metal Management Limited (SGM) FY10 EBITDA of A$352M (A$259M pcp) came in higher than our expectations of $343M (consensus A$333M) largely as a result of tighter cost control. While SGM continues to improve profitability, with an apparent forced stock build of ~400kt in 4Q09 and our lead indicators and data suggesting a weak 1H11 period, we downgrade our Buy recommendation to a HOLD with a share price target of A$18.50/sh (prev A$24.00/sh) which is 7x our FY11 EV/EBITDA valuation.
  BBY Corporate Finance – Your Strategic and Capital Partner
BBY Corporate Finance

 BBY is focused on providing solutions to our client's corporate finance problems. We specialise in delivering strategic advice to emerging and growing companies across a broad range of industries.

We believe in up front, commercial and personal service. Our team understands that each client faces different challenges that require customised attention from experienced professionals. We aim to carefully consider each client’s situation to ensure the optimal outcome is achieved.

BBY was ranked 11th Best Overall Investment Bank for the BRW East Coles Survey 2009 (2008: 9th) and was also awarded the 2008 Best Corporate Deal by The Australian Stockbrokers Foundation.

BBY is proud to have backed the following companies from less than $200 million market cap through to their significant achievements in joining the $1 billion club and more, and on being among the best performers on the ASX.

  
 
 

BBY Corporate Transactions 2010

BBY Corporate Transactions 2009

BBY Corporate Transactions 2008

BBY Corporate Transactions 2007

BBY Corporate Transactions 2006 

 Examples of innovative solutions to the problems and challenges faced by BBY's corporate finance clients include: 

Client Problem Solution

A

Our client encountered a short term working capital crisis.

BBY provided a specifically tailored bridging facility to ensure the continued operation of the company.

B

Our client required mezzanine funding to aggregate a set of assets within a specialised asset class.

BBY established a mezzanine facility to secure the targeted assets prior to underwriting an IPO on the ASX.

C

Our client thought that the most appropriate strategy was to list on multiple equities exchanges through which to attract international investors.

BBY assessed the client's operations, its potential investors and the comparable companies on four exchanges prior to advising the company on the most appropriate outcome.

D

Our client required strategic merger and acquisition execution advice approaching a target company.

BBY provided advice from the commencement of the transaction and continues to provide ongoing service to the client to maximise the outcome of the acquisition.

BBY's highly professional team has extensive experience in solving multiple problems for its corporate clients.  For example, in the following case study, BBY not only IPO'd the client, but solved numerous capital raising issues, delivered M&A outcomes, strengthened the share register and assisted shareholder communications for ASX listed clean coal company Linc Energy.

Linc Energy (ASX:LNC) Case Study

In late 2005, Linc Energy was introduced to BBY via another corporate client.  LNC had a strong vision and clearly articulated business plan for developing its Underground Coal Gasification (UCG) and Gas to Liquids (GTL) technologies.   The company required funds to implement its aggressive growth plans and corporate advice on the structure of its programs.

After numerous global marketing roadshows and the completion of the company's IPO process, LNC listed on the ASX in May 2006, raising AUD$22m.  BBY was able to introduce LNC to a client list of targeted, supportive institutional and high net worth investors that were aligned with LNC's ambitious plans.

Since that time, LNC has been one of the stellar performers on the ASX, including being the best performing stock on the ASX in 2008. 

Also In 2008, BBY won the prestigious Corporate Deal of the Year for the October 2007 $29.23m LNC placement at AUD$0.76.  Just prior to the award in July 2008, the stock traded at AUD$4.63 giving LNC shareholders who participated in the placement a 509% increase in value. 

In September 2008, LNC was included in the S&P/ASX 200 Index and also hit AUD$2 billion market capitalisation, an extraordinary achievement for a company that listed with an ~AUD$80m million market capitalisation, less than two and half years earlier.

On the M&A front, BBY was Corporate Adviser to the company in the successful acquisition by Scheme of Arrangement of Sapex Limited in October 2008. 

BBY has raised over AUD$270m for LNC in six capital raisings, including as recently as the August 2009 AUD$57.4m placement and the current $20m Underwritten SPP, where BBY introduced a completely new selection of very large, high quality domestic and offshore investors to the LNC register.  


BBY and LNC have developed a powerful partnership over the last four years.  BBY congratulates Linc Energy and its visionary Managing Director Peter Bond on the success to date and looks forward to assisting with the company's exciting future.


Rather than simply focusing on the next transaction, BBY seeks to grow over the longer term with its key clients, intimately understanding their businesses and strategic objectives and pro-actively becoming a key stakeholder.
 

BBY's team brings trusted relationships and specialist knowledge to all client services, such as:

- Placements  - Sell-downs/block trades
- Mergers and acquisitions - Convertible notes
- IPOs - Pre-IPO / private equity
- Rights Issues - Corporate advisory
- Buy-backs - Off-take management

Expert advice is offered in our sectoral strengths which include:

- Banking and Finance                                                       - Industrials
- Healthcare & Life Sciences                                           - Resources 
  (including energy & cleantech)
- Property

- Telecommunications, Media and Technology

The BBY corporate finance team utilises the sectoral and regional strenghts of its partners; Jefferies and CIMB-GK. By accessing their broad knowledge base and client network, BBY's clients are exposed to a global platform which maximises outcomes and facilitates the achievement of strategic and financial goals. 

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