I'll kick start this.
RFP
Market cap: 1.25 B
Net debt: 350 mm
Pension deficit: 1.8 B
TOTAL: 3.4 B
Assets:
Lumber: ~600m on 100m EBITDA
Pulp: ~1 B for 1.7 mm tonnes of pulp post Fibrek.
Paper: ~ 1 B at $200 ton for 5 mm tonnes
TOTAL: 2.6 B
Two swing factors here.
One, you have 5B plus of tax losses. This is somewhat of a stretch, but if you were to add 33% to the values above, you have an NPV of 860mm for the tax shield. Getting you to fair value.
Two, your pension deficit is valued at a low interest rate (I believe 4% discount rate), although this adjusts at every year end. They mentioned on their Q2 conference call that the move up in interest rates up until then would have decreased their pension deficit to 1.4B. The upward move in interest rates since then may mean it's more like 1.1B today.
These pension assets (6.5B) are managed by Prem & Co. Or more specifically, they selected most of the same managers as they selected for SickKids. See:
http://www.theglobeandmail.com/globe-investor/how-prem-watsa-turned-sickkids-portfolio-around/article1317596/"The strategy has made SickKids Foundation among the best-performing foundations in North America in terms of financial returns."
And I guess as a last kicker - I've heard that pension surpluses can be withdrawn in Canada.
