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Company takeover.

Discussion in 'Shares' started by Giulio, 9th Aug, 2007.

  1. Giulio

    Giulio Member

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    5th Aug, 2007
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    Location:
    Melbourne, Victoria
    What happens to the share price when one company gets taken over buy another, like the Westfarmers and coles senario?

    Ive noticed the Coles share price has fallen quite a fair bit. Why has this happened and do people normally veiw this as a buying oppotunity?
     
  2. bundy1964

    bundy1964 Well-Known Member

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    Location:
    Adelaide, SA
    Depends on the deal...some people thought the WES offer was under the cash offer that they turned down.

    I don't mind the deal and may take an all script offer.

    BEN today made a offer for ADB for all script.

    ADB soared on the news and BEN fell, BEN turned town the offer earlier from BOQ. I am a bit meh on the whole deal so far it would make them a top 100 which could up their LVR which being a long term holder would give me some more cash to invest elsewhere.
     
  3. Sk3tChY

    Sk3tChY Well-Known Member

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    4th Aug, 2007
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    Location:
    Sydney, NSW
    I'm probably wrong... but I thought when a takeover bid happens, the share price usually increases dramatically, because the company 'taking over' is buying out the majority of the shares, and offer a good price on them, to get people to sell.

    Someone correct me if im wrong, but im probably assuming this is only for completely shareholder owned companies, where 100% of the shares have been offered to the public.

    Some companies choose to keep 51% of the shares so they have the majority vote, in which case Im guessin the share price rising/falling will depend totally on the markets reaction to the new owners.
     
  4. Simon

    Simon Well-Known Member

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    Newcastle
    depends on how the deal is structured.

    Sometimes you get scrip in the new owner company, sometimes cash, sometimes both.

    With the Rinker takeover we had no option but to take cash :) :)
     
  5. Giulio

    Giulio Member

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    5th Aug, 2007
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    Location:
    Melbourne, Victoria
    hmm interesting, how do you find out the details of a take over bid and how its structured?

    Anyone notice the bendigo and Queensland bank merger? Share price went crazy!