China Minzhong Food Corporation

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

(02-09-2013, 09:26 AM)Jared Seah Wrote: Interesting. Indofood has gone ALL-IN?

This CMZ episode is more like betting red or black at the casinos.

More punting; less investing.

I curious kaypoh onlooker; not vested but taking notes:

1) Respected hedge fund manager in VB bailed out at 50% loss.

2) Early key investors all sold out at delicious profits.

3) Vested minority shareholders willing Indofood to bail them out instead of doubling down themselves.

4) Would minority shareholders vote down the GO from Indofood if the GO price is less than what shareholders have paid for?

Would we get a repeat of Nera Telecoms where minority shareholders judged the GO price as grossly under-valuing the company?

(How the person votes may reveal a lot on their true conviction on CMZ.)

Yes, it's an interesting learning experience... Not just on stocks related analysis but also, a good study of ourselves and each other... what we were thinking, what others were thinking (from their posts), as we went thro' the twists and turns of this drama...

IMO, Even if IndoFood do make an offer, it doesn't automatically mean there's not a single shred of truth in the report (even tho' it was stated as just an opinion).

What would you do if you were in IndoFood's shoes? Bearing in mind they'd taken an almost 30% stake previously and must have been seriously interested in this biz.

If I were them, the bigger priority now is to look forward, rather than backward. Firstly, the biggest question is whether CMZ remains a viable and profitable concern plus, will there be any future threats to this eg. China authorities decide to investigate further and suspend their operations. It'll in fact do them more harm than good if they were to focus on the backward part, since they're already vested rather substantially.

So, why not a privatisation offer, if CMZ biz is showing profits (assuming IndoFood has really done more DD)? Might as well take this as an opportunity when there're many motivated sellers....

Once they settle the more important forward objective, then, they can take their time to sort out the backward ones... But then again, since their origins is in Indonesia, what we in Singapore sees as Black and White, may be just very acceptable shades of grey.... Main objective, make money... as long as not defined as pure "Black" by the authorities...

(02-09-2013, 10:28 AM)WolfT Wrote:

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

The end result might be IndoF win, Glaucus also win, but minority shareholders will lose.

IndoF's win is paying lower for CMZ, Glaucus's win is covering the short will still costs lower than shorted price. Minority shareholders, who bought the share at high will lose.

A good learning experience, by just watching...

(02-09-2013, 10:28 AM)WolfT Wrote:

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

I tend to concur with some of these thoughts here. CMZ receives a letter of intent dated 9/2 (today) from Indofood and calls a trading halt at 6.52am. Exactly 12hours ago, they just decided to release the trading halt.

Don't think IndoFood will offering anything above 1sgd/share. An offer of 15-20% above last traded offer price will be interesting. I wonder what will the IFA be saying? - they will have an unenvious job of making the call of whether it is fair or undervalued. Some of the brokerage analysts in Spore (eg CIMB) have already been made to look like a fool in the last 1 week.. As forumer WolfT pointed out, this may be a case of collaborative efforts between CMZ-IndoFood to squeeze out the shortseller.

(02-09-2013, 10:45 AM)CityFarmer Wrote:

(02-09-2013, 10:28 AM)WolfT Wrote:

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

The end result might be IndoF win, Glaucus also win, but minority shareholders will lose.

IndoF's win is paying lower for CMZ, Glaucus's win is covering the short will still costs lower than shorted price. Minority shareholders, who bought the share at high will lose.

A good learning experience, by just watching...

Well if history is anything to go by is that the aggressor doesn't give up so easily. If indofood grabs cmz with a GO, depends the market could also get jittery and perceive this a bad decision, despite official coming forward with counter arguments and documents they may not be convinced cmz is legit or maybe they tasted first blood and want more, Glaucus and other short sellers may start to zero in on indofood methinks.

(02-09-2013, 11:02 AM)sgd Wrote:

(02-09-2013, 10:45 AM)CityFarmer Wrote:

(02-09-2013, 10:28 AM)WolfT Wrote:

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

The end result might be IndoF win, Glaucus also win, but minority shareholders will lose.

IndoF's win is paying lower for CMZ, Glaucus's win is covering the short will still costs lower than shorted price. Minority shareholders, who bought the share at high will lose.

A good learning experience, by just watching...

Well if history is anything to go by is that the aggressor doesn't give up so easily. If indofood grabs cmz with a GO, depends the market could also get jittery and perceive this a bad decision, despite official coming forward with counter arguments and documents they may not be convinced cmz is legit or maybe they tasted first blood and want more, Glaucus and other short sellers may start to zero in on indofood methinks.

Market cap of CMZ was S$347 mil base on last done price. Market cap of IndoF is S$6677 mil (base on number from Bloomberg). Even Mr. Market will perceive that the GO is a bad move, it might not trigger a crash of IndoF.

http://www.bloomberg.com/quote/INDF:IJ

Having said so, short-sellers are professional, who might surprise us. I will stay tune for learning...

Letter if intend or MOU are not confirmed deals, so may just another wayang to delay.

(02-09-2013, 11:02 AM)sgd Wrote:

(02-09-2013, 10:45 AM)CityFarmer Wrote:

(02-09-2013, 10:28 AM)WolfT Wrote:

(02-09-2013, 10:14 AM)CityFarmer Wrote:

(02-09-2013, 09:59 AM)WolfT Wrote: I think all this takeover thingy is just a smoke bomb to halt trading, maybe to buy time or to think of ways to 'disturb' the short seller....just a feeling.

It is quite unlikely a smoke bomb, but the offer, if materialized, will create a short squeeze for short-sellers...

IndoF unlikely to pay a lot of money for Cmz. This will drag for a long time... I do not know what they are planning to do. Most likely IndoF and Cmz are together in this to do a win-win thingy but maybe not to the advantage to the rest of the shareholder...

The end result might be IndoF win, Glaucus also win, but minority shareholders will lose.

IndoF's win is paying lower for CMZ, Glaucus's win is covering the short will still costs lower than shorted price. Minority shareholders, who bought the share at high will lose.

A good learning experience, by just watching...

Well if history is anything to go by is that the aggressor doesn't give up so easily. If indofood grabs cmz with a GO, depends the market could also get jittery and perceive this a bad decision, despite official coming forward with counter arguments and documents they may not be convinced cmz is legit or maybe they tasted first blood and want more, Glaucus and other short sellers may start to zero in on indofood methinks.

If it is after 6mth of that placement, Indofood offer 10 cents for CMZ also can. no restriction on minimum offer price already.

likely Indofood did not buy anything before the trading halt.

Many conglomerates of Indonesia are good in their own turf, Salim grp made their monies in Indo , especially during the regime of Suharto, they are not doing well in Phillipine , hk or even Singapore.
Most of them make monies because of who they know and not really what they know.

If looking deep into the rebuttal, CMZ did not prove their revenue, profit, margin or PPE. What they have shown is that they did valid transaction before Hong Kong Yifenli incorporates if their documents are real. They did transaction with their top supplier til late. And the PPE was shown in their filing.