Author Topic: Fairfax India new issue  (Read 183440 times)

SharperDingaan

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Re: Fairfax India new issue
« Reply #410 on: July 15, 2020, 07:29:43 AM »
Assume FFH does NOT record the impairment - subject to an annual future MM impairment charge.
It is not unusual for different owners of the Toronto DT towers to have different valuations on their ownership portions of the same tower (precedent)- and just reflects their differing future opinions. IFRS accounting is accepting as long as the opinion and valuation is documented - and there is annual impairment testing (valuation model re-run with current data), if the opinion difference is material.

SD



Xerxes

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Re: Fairfax India new issue
« Reply #411 on: July 15, 2020, 07:42:28 AM »
It is no different than two different investors having a different opinion of a publicly traded stock, thereby moving the stock.

In illiquid assets samething happens but at a very slow speed paced by quarterly releases.
« Last Edit: July 15, 2020, 07:44:15 AM by Xerxes »

Tompety03

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Re: Fairfax India new issue
« Reply #412 on: July 15, 2020, 10:12:00 AM »
For sure - that makes sense that people can use their own internal valuation models absent a transaction.  But if Fairfax just sold more of the airport to Onex at a certain valuation, don't they have to adjust their mark to that valuation?

Chris

Xerxes

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Re: Fairfax India new issue
« Reply #413 on: July 15, 2020, 10:37:21 AM »
I am no expert.

I think the marked down ought to happen.
But marked down is not as bad as impairment that is typically not reversed back with a mark up.

bizaro86

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Re: Fairfax India new issue
« Reply #414 on: July 15, 2020, 11:38:38 AM »
For sure - that makes sense that people can use their own internal valuation models absent a transaction.  But if Fairfax just sold more of the airport to Onex at a certain valuation, don't they have to adjust their mark to that valuation?

Chris

Did you mean OMERS? Fairfax already marked the airport stake up to the value OMERS paid for it. That's a bad mark (imo) because they effectively guaranteed OMERS the price - if they don't IPO it at a certain valuation, OMERS gets more shares to make up the difference.

SharperDingaan

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Re: Fairfax India new issue
« Reply #415 on: July 15, 2020, 11:47:21 AM »
It will be a year-end 'discussion' item with their auditor.
One side will argue that it was isolated, and correctly accounted for via the loss recorded on date on sale. As a result of the sale, the valuation premise of the remaining stake was further strengthened - hence an impairment write-down is not required (opinion). The other side will most likely concur - subject to a disclosure note that outlines the material facts of the transaction. Reader makes his/her own decision.

Comes back to the trust, vision, and informational reporting thing.
One is either OK with this kind of thing, or not.

SD

Parsad

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Re: Fairfax India new issue
« Reply #416 on: July 18, 2020, 03:40:59 PM »
Why Silicon Valley's Biggest Companies are Investing Billions in India:

https://www.cnn.com/2020/07/17/tech/google-facebook-india-investment-jio/index.html

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wondering

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Re: Fairfax India new issue
« Reply #417 on: July 22, 2020, 10:23:09 AM »
https://economictimes.indiatimes.com/industry/banking/finance/banking/fairfax-backed-csb-bank-weighs-buying-out-other-old-private-banks-to-expand-its-balance-sheet/articleshow/77093694.cms

Sorry, besides the headline, the rest of the article you have to login. I didn't bother, but it's interesting to see that CSB is looking to expand.