There’s been speculation that significant shareholders may want to block the PTEC bid in the hope of a higher offer.
I know nothing about how the city thinks. Here are some random thoughts of mine in no particular order: * The 400p offer was announced 1 June 2014 7.15am
* none of the arbitrage players are getting involved
* the fact that PLUS are recommending a takeover at 400p, containing a break clause, suggests (to me anyway) that they’re serious about the deal, and don’t think they can get better * if you buy that last argument, then why would Odey want to try to block a bid?
* On 1 June, 12.31pm an RNS was issued stating that on 29 May, Odey took their stake over 21%
* On 2 June 9.14am, JP Morgan notified on 1 June that they took their holding above 5%. The RNS is confusing, because it doesn’t state the date of the transaction. I presume that they upped their stake knowing full well of the 400p offer. If memory serves, they had actually been reducing their holding.
* On 2 June 9.35am, Odey Asset Management issued an RNS stating that they had taken their holding about 25% on 1 June.
* I’m having trouble fathoming out what JP Morgan and Odey Asset think they see. Surely a bid of 400p effectively puts a ceiling on the share price, doesn’t it? If they block the bid, then they may not get a better chance.
* Doesn’t the fact that JPM and Odey buying above 400p given them cause for concern about their investment case?
* Why did PLUS announce a bid with PTEC, presumably knowing that Odey might try to block it?
tl;dr: a big giant WTF.
Update 02-Jun-2015 : There’s some interesting speculations on the boards today. AdamB1978 suggests that Odey might actually want to back the bid. By buying in below the bid price, they can at least make some money. An interesting point indeed. He seems confident that PTEC cannot arbitrarily pull out of the bid. molatovkid counters that PTEC are performing due diligence, and therefore are unlikely not to be able to pull out if nasties are found. And let’s face it, I don’t think that anyone is expecting that there are no nasties . He also raises the question as to why PLUS seem keen to accept such a low offer. Speaking on behalf of myself, I have noted that PLUS management have been very (i.e. too) economical with the truth, with sudden surprising information being tossed out from time-to-time. The situation could be much worse than some expect.