Forum Archive Index - May 2004

["davida" <davida@wave.co.nz>]

Thanks for your advice Snoopy
its appreciated

-----Original Message-----
From: sharechat-owner@sharechat.co.nz
[mailto:sharechat-owner@sharechat.co.nz]On Behalf Of
tennyson@caverock.net.nz
Sent: Wednesday, May 12, 2004 6:25 PM
To: sharechat@sharechat.co.nz
Subject: Re: [sharechat] wri


Hi david,

>
> I see wri trading at $1.39 & takeover offer at $1.50
> Surely a good play at 10c per share profit to onsell to Norgate
>

It is only a partial takeover offer.    Norgate only wants 50.1% of the
shares.     So yes it is a good arbitrage play IF the Norgate offer is
successful and IF you can get all of your shares away to Norgate.  But
those are two big 'IF's.

I think what Mr Market is saying here is that if you buy shares at $1.40,
then half might be sold to Norgate at $1.50, while the ones he doesn't
want are likely to slip back in price to $1.30.     That is not an
unrealistic representation of what might happen, and would leave you
square if you bought shares on the market at $1.40.

The other option is that the Norgate bid fails and he seeks to divest his
stake, probably at a discount to the $1.45 he bought in at.    $1.40
could be on the mark here too.

In short, I don't think there is a free lunch being dished up by Mr
Market here.

SNOOPY





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