Follow up post to comments on the previous DVN post...
As noted by other people and my follow up comments, the situation with CIMIC smells. And the smell gets worse. A separate, non-binding offer has been made for DVN for 90c, which of course trumps CIMIC's 75c offer. As the takeover would be via Scheme of Arrangement and therefore requires 75% of votes, CIMIC can matter-of-factly block the deal as it owns 50.63%.
So this has truly forced CIMIC to show its hand. CIMIC has responded by saying they are proceeding with their offer, effectively confirming they want to buy DVN for a song. Typically with takeover trades you can justify buying a bit above the bid price in the hope another bidder comes along. That probably won't work in this case given CIMIC's stance. I suspect it would take a much higher bid to dislodge CIMIC and your guess is as good as mine as to whether that might happen.
At 80c it is a tough call. CIMIC can block any other deal and the share price could drop plenty when their offer expires. I've been selling recently, and I'm out completely.
Kristian
Disclosure: no position in the above.
As noted by other people and my follow up comments, the situation with CIMIC smells. And the smell gets worse. A separate, non-binding offer has been made for DVN for 90c, which of course trumps CIMIC's 75c offer. As the takeover would be via Scheme of Arrangement and therefore requires 75% of votes, CIMIC can matter-of-factly block the deal as it owns 50.63%.
So this has truly forced CIMIC to show its hand. CIMIC has responded by saying they are proceeding with their offer, effectively confirming they want to buy DVN for a song. Typically with takeover trades you can justify buying a bit above the bid price in the hope another bidder comes along. That probably won't work in this case given CIMIC's stance. I suspect it would take a much higher bid to dislodge CIMIC and your guess is as good as mine as to whether that might happen.
At 80c it is a tough call. CIMIC can block any other deal and the share price could drop plenty when their offer expires. I've been selling recently, and I'm out completely.
Kristian
Disclosure: no position in the above.
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