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Comments re qantas

Discussion in 'Shares' started by handyandy, 16th Apr, 2007.

  1. handyandy

    handyandy Well-Known Member

    Joined:
    6th Jun, 2006
    Posts:
    312
    Location:
    Sydney Nsw
    Hi All

    Just looking for some input regarding the Qantas privatisation offer.

    I bought in to this back in January and have been patiently waiting for it to finalise.

    I can now accept the offer and take my 23cents plus the 15 cents + the imputation I already banked. Not much but I thought it would finish a lot quicker and thus be 7.6% return over 2 months.

    Obviously its been somewhat longer in gestation but I did get an additional 5cents in imputations.

    The other option is to hold out further, with the word being that potentialy the final price, within a year, could be $7 making a return of 34%.

    This has a lot of risk but also I see some safety.

    - APA can't let the share price fall to far below the $5.45 - 5.6 as their loans are secured agaisnt the shares (one giant margin loan:eek:)

    - They will in the end need to buy out remaining shareholders as they can't proceed to strip company until they have full ownership.

    - Plus side they need to declare dividends as they will need to pay their loan interest. Is there another way that they could get money out without declaring dividends.

    If they reach compulsory aquisition then what would the price be at that point? Or does the whole compulsory aquisition thing go out the window?

    Cheers
     
  2. DaveJ

    DaveJ Well-Known Member

    Joined:
    13th Nov, 2005
    Posts:
    123
    Do you have any other plans for your invested 'Qantas money'?? If not, then maybe no harm in staying with Qantas... But if you do then maybe that could be the deciding factor?

    The Opportunity Cost of keeping the money with Qantas in the small hope of a higer offer may be greater then the potential 34%???:confused:

    DaveJ


    P.S. I wouldn't want to be holding QAN if APA decide to take their bat&Ball and go home. :eek: