I still think there is a little more to go down, but they are a good bet for $4 within 3 years. Just bought decent parcel myself.
Kohlberg Kravis Roberts (KKR) takeover offer of 3.50 which is only indicative and very conditional (they want our dividends subtracted if any are payable before takeover is implemented). Anyway its good news for holders, especially for those who don't know what the hell they're doing, as at the least, it'll give an improved market perception of the company's value and upset the shorters who have been very busy with VOC. It'd get me out at break even, as I only have 2,000 shares at 4.40 and 2.37, but I hopefully i was totally ignored at 4.40; I'm only here to chatter about my interests, but try to keep it real now by posting on my buys and sells. What am I saying? - I know I'll succumb to blathering about charts again.
I bought in 2.43 as I was confident that Vocus was worth more than that $4 as sum of its parts. I have a feeling KKR will have up its bid or another few suitor will come into play to strip, split and relist in three years. Bearing in mind at $3.3B they can just finance the purchase off cashflow, if they sell Non Core assets NZ business, Amcom (made redundant due to purchase of Nextgen), Datacenters and consumer business - the sale of these could realise $2.5billion which means tthey will have bought Vocus for $500 million in debt.
I kind of hope the bid fails, even though it'll flatten the share price again. I'd rather bet on the outcome a few years down the track. Some of my dud calls are showing a bit of buoyancy recently: VOC, AGI, DRM, IMD I'm not betting it's over for VTG yet
From KKR point of view, the lowball offer will flush out other interested bidders if any and even more valuable a trade company could sign up to paying cash for non core parts of the business, firming up the economics for KKR. Even without any other bidders, my bet is that KKR will already factored in two further offers. 1. Small negotiated fee/incentive to see the books 2. Than a final offer if they can stomach the risk However if there are other bidders, than KKR will likely play it by ear, and see what it will cost for a minimum bid to get access to books. My gut feeling is that, no other offers will be forth coming though.
A new bidder has has emerged, Affinity Equity Partners. The street talk is AEP or KKR, will be chop Vocus into bite size chunks to avoid ACCC concerns and sold to trades concerns.
