If you purchase REI, you are betting on the Ruppert family and that they are able to provide long term value for shareholders. Currently REI stake in BAT accounts for approx 80% of the REI fund, within the laws of Luxemborg, they need to reduce this stake to 30% of the total REI fund within approx 2 to 3 years. This can be done by either increasing the total REI fund value, which is highly unlikely, or by selling off part of their stake in BAT (more likely).
and having had conversations with the dirrectors I can tell you they are totally in love with the BATS holding. They think it is impossible to outperform it, at the moment which is why they have made no purchases of substance.. time will tell.
A lot of people have complained that they have missed their chance to invest some of the cash but perhaps it is a little early to judge and another sharp correction will present a good opportunity to make some new investments. All in all it's not the worst position to be sitting in with a defensive stock like BATS and cash making up the bulk of your investments in uncertain times like this... Let's not forget it's a very good rand hedge...
Garth is not "trading in the zone" right now, so I'd be a little carefull. Already down on this trade. If he makes a loss by the end of the year, will he be able to right his loss off against his gains for 2012 if he already donated the loss to charity ? ;-)