If I am a seller, I would not sell at 1.115 as I even have to incur brokerage. I might as well sell it to Indofood at 1.12 without any brokerage. The offer is already declared unconditional they have to honour this price. It is obvious that the report of Glaucus no longer has any effect on the share price now.
CHINA Minzhong Food Corporation Ltd on Monday clarified that it only has one set of books, which are audited by its local auditors in China for filings in the mainland, and by its external auditors, Crowe Horwath First Trust LLP (CHFP) for Singapore filings.
It was clarifying a column by Associate Professor Mak Yuen Teen of the NUS Business School in a "Letter to the Editor" in The Business Times on September 5, 2013.
Today's trading price is about $1.04, or 16 cents upside to $1.20 the offer price.
If Minzhong's boss can finalise the bank financing for the buyout within 3 months & a definitive agreement is also inked by then --> the potential return would be about 11%, assuming the announcements catalyse the stock to shoot up to $1.15.
The beauty of it is that on an annualised basis, the return would 11% x 4 = 44%.
The return would be incredible if the stock shoots up to $1.15 in a month --> 11% x 12 = 120%.
The downside is that the whole thing is aborted, in which case the stock probably will drop to its pre-announcement price of ard 80 cents.
Puzzle here: Indofood sells 52.94% and retains 36.05% of CMZ. There's every reason to expect almost all of the minority shareholders to sell too which is the remaining 10% of the company. Like that still can continue as listco? Will there be a compulsory placement?
It's rather strange that Indofood would agree to sell a big stake just over a year after buying it. Conspiracy theory --- Indofood rescued Minzhong last year from the scathing attack by a short-seller's report under a tacit agreement with Minzhong boss that it would be able to sell a major stake later.