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ML Macadamia Orchards LP Message Board

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  • babykyak babykyak Nov 16, 2006 7:13 AM Flag

    Back in 1991 I bought

    What I was asking was...
    What would the company be worth if it sold its land? The article stated that the true value of NUT was much higher than on the books, i.e. a great investment. Thanks for the edu.

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    • Lets see....

      So, if I am to follow the logic a bit further, you purchased a stock for the value of its "assets" (in this case, land) thinking that they (or new management) could somehow use/unlock/monetize the higher value of land (presumably similar to timber companies selling their land, at a huge gain), obtain rezoning/zoning variances and then sell to a developer? And this "value" would only be for the land they own, I believe several of the orchards are simply leased land on which NUT operates. I wouldn't expect significant gains from selling "wholly owned" orchards and then leasing them back. I don't know that such a transaction would provide the pop you are looking for.

      To be honest I wouldn't expect that rezoning of the orchards would be even a remote possibility. My assumption is that Hawaii is pretty restrictive on their zoning and would not look favorably to developing agricultural zoned land for condos, hotels and/or other commerce.

      Best.

    • Land is not depreciated, so it stays at book.

      "Since the May 2000 purchase of the macadamia farming operations, the Partnership farms its own 4,169(or 4190) acres of macadamia orchards"

      Property Plant and Equipment $46,406,000

      Value is about $10k an acre

      Most of the balance sheet is land, so you buy about $10k of stock you theoretically have around an acre of land in Hawaii.

 
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