CapitaMalls Asia

(17-05-2014, 10:47 AM)momoeagle Wrote: Huat huat huat!!!

Lucky I advised 2 friends not to sell on the open market for the simple reason of no need to incur brokerage fees

I also advise my friend to just accept the offer letter and don't sell it on open market. Unfortunately, he does not want to listen to my advice and sold it in the open market at 2.23.

(17-05-2014, 11:39 AM)lonewolf Wrote: ghchua, can clarify one thing about S215 CA compulsory acquisition?

Does the shares that CAPL acquires on the open market counts or must the 90% be from shareholders who accept the offer and tendered their shares to CAPL?

Those shares that CAPL acquires on the open market also counts towards the 90% for S215 CA compulsory acquisition, as long as they are acquired after the despatch date of the offer document and during the Offer period.

(17-05-2014, 05:19 PM)ghchua Wrote:

(17-05-2014, 11:39 AM)lonewolf Wrote: ghchua, can clarify one thing about S215 CA compulsory acquisition?

Does the shares that CAPL acquires on the open market counts or must the 90% be from shareholders who accept the offer and tendered their shares to CAPL?

Those shares that CAPL acquires on the open market also counts towards the 90% for S215 CA compulsory acquisition, as long as they are acquired after the despatch date of the offer document and during the Offer period.

Sounds strange. How can selling in the open market be considered acceptance of the offer? Can't be sure who's the buying party...

^^ those sold on the open mkt has given up right to the offer. But the buyer counts towards 90%.

Thats another reason why accepting the offer is better than selling in mkt: there may be higher offer. The "option" is worth something

(18-05-2014, 12:39 AM)specuvestor Wrote: ^^ those sold on the open mkt has given up right to the offer. But the buyer counts towards 90%.

Thats another reason why accepting the offer is better than selling in mkt: there may be higher offer. The "option" is worth something

IMO, given up rights to offer should not mean acceptance.

However, this case seems to be handled specially by 215(11) of Companies Act. I would really be interested in the rationale for such a clause, especially regarding transactions in the open market where the seller does not know who the buyer is (unlike married deals).

http://statutes.agc.gov.sg/aol/search/di...0#pr215-he-.

(11) Where, during the period within which an offer for the transfer of shares to the transferee company can be approved, the transferee company acquires or contracts to acquire any of the shares whose transfer is involved but otherwise than by virtue of the approval of the offer, then, if —
(a)
the consideration for which the shares are acquired or contracted to be acquired (referred to in this subsection as the acquisition consideration) does not at that time exceed the consideration specified in the terms of the offer; or
(b)
those terms are subsequently revised so that when the revision is announced the acquisition consideration, at the time referred to in paragraph (a), no longer exceeds the consideration specified in those terms,
the transferee company shall be treated for the purposes of this section as having acquired or contracted to acquire those shares by virtue of the approval of the offer.

Hi smallcaps,

I think what you have re-produced here (i.e. 215(11) of Companies Act) is more on the consideration (i.e. the amount) that the Offeror can pay to acquire those shares from the open market other than from acceptance in order to count towards approval of the offer.

(a) What it means is that when CAPL initially came out with $2.22 offer for CMA, they can only buy CMA shares from the open market at $2.22 per share or less. They cannot buy CMA shares at say, $2.23 from the open market.

(b) But when CAPL came out with a revised offer at $2.35 for CMA, they can now buy CMA shares from the open market at $2.35 per share or less.

(18-05-2014, 10:37 AM)ghchua Wrote: Hi smallcaps,

I think what you have re-produced here (i.e. 215(11) of Companies Act) is more on the consideration (i.e. the amount) that the Offeror can pay to acquire those shares from the open market other than from acceptance in order to count towards approval of the offer.

(a) What it means is that when CAPL initially came out with $2.22 offer for CMA, they can only buy CMA shares from the open market at $2.22 per share or less. They cannot buy CMA shares at say, $2.23 from the open market.

(b) But when CAPL came out a revised offer at $2.35 for CMA, they can now buy CMA shares from the open market at $2.35 per share or less.

I would have to disagree. My interpretation is that without (11), open mkt purchase and married deals would not count towards approval of the offer, regardless of price paid.

"IMO, given up rights to offer should not mean acceptance."
Unquote:-
i agree. You got a very good point. There are 101 reasons why people sell in the open markets at lower than the offer price.

Why does it makes sense for the buyer to buy stock in the market that does not carry the shareholder right of accepting the offer?

(18-05-2014, 04:35 PM)specuvestor Wrote: Why does it makes sense for the buyer to buy stock in the market that does not carry the shareholder right of accepting the offer?

IMO, becoz the buyer is the Offeror and thus it does not have the right to accept the offer.