ICUMD

Seems like Haniyeh, regardless of his billions, is not without suffering: from Wikipedia - Haniyeh currently lives in Qatar.[59][60][61][62] In October 2023, 14 members of his family were killed in an Israeli airstrike on his family home in Gaza City, among them a brother and nephew.[63] In November 2023, a granddaughter of his was reportedly killed in an Israeli airstrike in Gaza City.[64] Later that month his eldest grandson was killed in an Israeli strike.[65] Three of his sons and three grandchildren were killed in an Israeli airstrike in the Gaza Strip on 10 April 2024.[66] [6

@giulio thanks for the excellent summary. My main thoughts attending the meeting online were 1. Air India making BIAL a secondary hub is a game changer. All of a sudden you are guaranteed international connectivity and incr passenger volumes. This will translate into huge revenue streams, esp for their non aero businesses. International passengers have much deeper pockets than domestic, on average. 2. Financial services can grow faster than infrastructure developments. IDBI, if they can cinch the deal under Fairfax India, would be the next game changer. Hopefully announcement on this will happen after Indian elections close in June. 3. Anchorage Doesn't seem to be a huge priority, though I could be mistaken. 4. SIB Doesn't seem to be in the works. They are apparently happy picking up shares on the market.

Bought a little BCE. BCE owns the telecom infrastructure. Forced competition and cost reduction will slow build out of fibre to small communities. Ultimately, this company needs to survive and expand and all Canadians need to be connected. Political interference can only go so far. Starlink and satellite Internet are bandwidth constrained relative to fibre. (I know, since I have Starlink and wish I had fibre). Hard not to add at these levels and dividend is highly attractive.

I've also not been able to get clarity on whether or not the UDFs were being recalculated in each control period as per the contractual agreement. In their reports, there is never any confirmation the UDF was paid as per the agreement. Only vague statements. Recalculation was especially important during the pandemic.

BNS.to 6.2% yield from a Canadian Charter bank, hard to pass up. Personally loaded up to the brim sub 60s.

@SafetyinNumbers Appreciate the counterarguments. I've been too optimistic previously so its good to have expectations tempered. Still not convinced the sidecar model is the way Fairfax will go since I think ultimately they will want to outright own BIAL and IDBI, which can most swiftly accomplished with FIH going private. Potential investment partners will face regulatory hurdles possibly scuttling a deal or introducing delays. FIHs market cap of 2 B means they are going elephant hunting for a 6 B IDBI with a pistol. Yes, they can use credit lines and sell assets, but still will fall considerably short. Some reports say IDBI will sell expensive, maybe around 2x BV. Government of India needs to make this look like a good deal on their end. Indian markets are strong, so not expecting a fire sale here. Yes privatization will mean FFH will have to give up the management fees that Fairfax India generates for them. So that is the negative and maybe the reason why privatization won't happen. Long run, my wager is outright ownership outweighs the fee structure benefits for FFH. Prem outright owning two prized Indian assets will be a tremendous source of pride for him. I think we can agree the next 12 months will be interesting none the less.

You raise lots of great points, and I'm just presenting one scenario for arguments sake. I'll address your Sidecar thesis: Fairfax India has no money now after their 200M has been earmarked to back stop IIFL, if my accounting is correct. Yet they have soon thereafter confidently placed an all cash bid for IDBI. They must already have a source of money lined up. Seems to time well with their outperformance at FFH. I personally doubt that they will find investors who will foot the majority of the bill for IDBI, and then pay heafty fees to FFH for management, based on an estimated BV, while trading at depressed values on the N. Amercan market. The only investor to do so would be FFH. Even Omers would be out. Abu Dhabi investment fund or Siemens? Not a chance. Dealing with these guys on such a large purchase would be a nightmare. FFH buying IDBI directly is a possibility, but then they would be going back on their word that FIH is their non insurance investment vehicle in India. In any case, I could be wrong, but buying out Fairfax India to make it private is what I would do under the circumstances. Once the Indian investment portfolio is more developed with acquisitions, option is always there to take it public again when it can act more favorably for raising capital.

Speculative, but Fairfax taking Fairfax India private is the best and most likely play. Consider: Recent all cash offer for IDBI by Fairfax - the are serious bidders. BIAL is a jewel company with guaranteed return and growth. I suspect they view IDBI as another diamond in the rough. It probably is. They only coinvest with select pasive investors like OMERS. (They weren't too happy with GMR and paid a premium to kick them out of BIAL). Coinvestment only helps them manage their risk at the expense of their ownership and control. I doubt they will be keen to be part of a consortium to purchase IDBI when then can do so easily via FFH. Plus, they will need to share ownership with the government and LIC as it is. Fairfax India has performed poorly in North America, but Anchorage will truly value their Indian asset base. This I think will occur after they take Fairfax India private, since doing so before risks inflating the share price and increasing the price of a buyout. The only advantage I can see of Fairfax India trading publically is it's ability to raise capital through sale of shares. Ironically, due to depressed share price x 10 yrs now, they are now capital constrained to make large purchases, such as IDBI. They have used their 200M in the bank to back stop IIFL. They will need a billion or two in short order if they get IDBI. When your kid needs money in short order for a worthy venture, who is most likely to offer it?

Thanks Parsad, If I were Prem, instead of inviting my investor friends to share another golden company that is IDBI, I would issue shares of FFH to buy FIH.U from existing investors to make it private, while conserving cash. I would then use available cash to purchase IDBI. That way I get to keep the whole pizza, including the airport. I think this will happen sooner than later since IDBI divestment will happen within the next 12-24 months. Of course, I own only Fairfax India, so I may be simply over optimistic.

This is the billion dollar question. Fairfax has said aside from insurance, Fairfax India will be the vehicle for all other investments in India. They have recently placed an all cash offer for IDBI bank. Where does the cash come from? If they aren't issuing new shares at discounted market prices as previously stated, their only other option is to find an investment partner, like Omers. Alternatively, could money laden Fairfax opt to buyout Fairfax India and take it private? They would then have deep enough pockets to chase IDBI. It would also optically solve their issue of discount. Pretty sure Prem wants to close that IDBI deal badly.

https://www.business-standard.com/companies/news/canada-based-firm-fairfax-offers-all-cash-deal-to-acquire-idbi-bank-124031800325_1.html

Mine: Use active excess cash flow to Increase net passive cash flow

All of this is excellent imo. RBI oversight and review will help improve the quality and transparency of these businesses over the long run. This is necessary to attract FDI. Through the vetting process, the value of underlying businesses increases.

Amongst his peer group, seems like a pretty good leader doing a great job. Not an easy task to lift a few hundred million out of poverty. Curious to read the critiques on Netanyahu, Putin, and Biden/Trump.

Interesting that Fairfax India is potentially becoming a lender to a lender, IIFL. Hopefully they manage the risk appropriately.