Ann: Wellcom enters into Scheme Implementation Deed with Innocean, page-15

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Lindo

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23/11/19

22:32

Post #: 41596712
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Originally posted by hcosah: ↑

I have always thought that investing in Wellcom is like being a silent partner in a family business. We have had all the benefits of the knowledge and expertise of the company founder (controlling shareholder), with none of the stress of management. We haven't been diluted along the way by discounted placements or excessive equity packages to staff. We haven't even been asked for a pro-rata contribution to get the company though a tough spot, yet we received buckets of dividends. To my knowledge Wayne Sidwell purchased every share he owned, many on-market, effectively supporting the share price when it was weak. These are rare attributes in the modern market place. This company has had consistent and way above market performance.

My best guess is that this is the right decision for all shareholders. I am not going to question such an astute business person over the right call in their industry. It is of course possible that he has just run out of gas. Noni B (2007 to 2014) is a good case study where a founder lost interest but couldn't exit prior to the business losing its way. You dont want to be there.

I dont know the real reason behing the put option although I expect that Innocan is keen to have some involvement from Wayne in the early years. As for the break fee, it is standard to put some from of poison pill in an arranged deal to stop directors shopping it. As much as I'd like to remain a holder for life I think at the current point in time its a good deal and I dont think personally the future would have been as bright if Wayne had simply sold his stake. I considered Wellcom to be my core portfolio company so disappointed too, particularly where quality and value are in short supply.

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The story will always be the same (never fall in love with a stock ) see you at EGN another quality and value stock

WLL Price at posting: $6.70 Sentiment: Hold Disclosure: Held
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Ann: Wellcom enters into Scheme Implementation Deed with Innocean, page-15

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