Friday, May 22, 2009

Taipan Thursday Terminates in Tantrum

Dear Fellow Shareholders,

As any player with economies of scale would know, one of the great shortcomings of the Happy Valley Races is that you cannot short-sell your opponent's horse. It is a tactic that would have come in useful at last Thursday's meet.

Dunross - now back in Hong Kong - challenged me to "Taipan Thursday" at the races. The parameters were straightforward: HK$20 million in each pot, Hong Kong Rules apply. I simply could not refuse as Dunross' own horse - Noble Man - was running in Race 8, no doubt be the decider.

Dropsy Wong, my personal assistant, arranged for a car to the races. As a man of the people, I then stood track-side and committed HK$20 million of Rothwell-Gornt's own money, confident in my abilities as a proprietary trader. High above, in the safety of Jockey Club Stewards box, I could see the familiar figure of I.S. Dunross, Taipan of the Noble House, looking down.

Betting started in Race 3. Both Dunross and I went in cautiously, with Dunross taking the early spoils - a meagre HK550,000. In Race 4, Dunross spread his bets across no less than six horses - the risk averse investment thesis of Struan's all too apparent. His tactic didn't work, and I evened the tally with a HK$500,000 win.

By Race 5, the stakes - and the risks - were getting higher. I opted for an ambitious quinella, which backfired, while the Taipan also had bad luck. We racked up over HK$5 million in losses between us. The turning point came in Race 6 - my losses of HK$400,000 comparing favourably to Dunross' HK$3 million expense. In Race 7 I capitalised on my already strong position with a famous HK$9.65 million win - my best performance this year.

As things stood, by Race 8 - our final round - my pot stood at HK$26.75 million, the Taipan's below HK$17 million. Standing on the terrance, Dunross gave me a secret hand sign - "all in Taipan", it said. We committed our remaining stakes. The race was going my way until the final furlong. From the back of the field, Noble Man staged an impressive sprint to take second place, and Dunross had won big. A replay can be seen here.

The final standings were: Gornt down HK$3.75million, Dunross up HK$5.8 million. My loss shall be disclosed in Rothwell-Gornt's Interim Report as "Miscellaneous Expenses".

Best of joss,

Quillan Gornt
CEO and Taipan
Rothwell-Gornt Holdings

PS - If anyone from the Hong Kong Jockey Club is reading, I am still awaiting my invitation to the Board of Stewards.

Thursday, May 7, 2009

Hanoi Hilton for Dunross and Co.

Dear Fellow Shareholders,

My sincere apologies for not communicating with you sooner!

As you might expect I have been preoccupied, unable to tear myself away from the realtime market data supplied my customised 18 carat gold engraved “Taipan QG” Bloomberg terminal. The Hang Seng, you see, has rallied, restoring my previously undervalued net worth and boosting the market capitalisation of this esteemed firm to pre-crunch levels.

As much as I hate to be the one to dampen your euphoric spirits, I must warn you of a potential suspension of trading, and a short-term correction to Rothwell Gornt shares. This action is based on rumours that Ian Dunross will be returning to Hong Kong in coming weeks. The market is already awash with disruptive and false rumours of a Noble House takeover.

The purpose of the Taipan’s visit is essentially benign: he is coming for the Annual General Meeting - originally scheduled in Koh Samui - while also spending a few days in Hong Kong. As a practical joke, I have acquired a minority stake in Struan’s in his absence. Using my voting rights, I have changed the location of the AGM from “Koh Samueee” (as the Taipan says), to Hanoi, Vietnam. The Taipan seems to be the last person on earth not to know about this.

Activism indeed! David Webb would be proud.

In the meantime, I have asked my secretary, the delectable Urethra Chan, to ensure that the Taipan’s flights are changed accordingly – that he flies economy class from Hong Kong to Hanoi in accordance with Noble House regulations (less than 3 hours for business) – and that he be delivered a gluten intolerant vegan lacto-ovo meal during the journey. In Hong Kong, I have kindly offered to pay for his accomodation in a suite at the Metropark Hotel, Wan Chai.

See you in Hanoi, Dunross!

Best of bull market joss,

Quillan Gornt
CEO and Taipan
Rothwell-Gornt Holdings