wes vs wesn, page-11

Jelbayeh,

Just having a read through the scheme, the answer to your question appears to be yes (you do get 1.25 WES shares for each WESN you hold) if the price at the lapse date is less than $36)

HOWEVER ...

If the S&P/ASX 200 Industrials Index averages less than 6,500 for the two months immediately prior to the
Lapse Date, Wesfarmers can extend the Lapse Date by 12 months. Wesfarmers can extend the Lapse Date on each of the next three anniversaries (for 12 months each time) if the index averages below 6,500 for the two month period immediately prior to each anniversary so that the Lapse Date can be up to a maximum of eight years from the date of issue.


SO in effect Wesfarmers have the right to delay issuing the additional shares for UP TO 8 YEARS (OR 2015) if the S&P 200 remains under 6,500. I guess, the fact that if the S&P 200 reaches 6,500 by 2015 WES would most likely be more than $36 anyway pretty much reduces their possibility of issuing the additional shares. Most of us would probably say that the market should recover within 8 years, so maybe this deal isn't all that great!

Is my reasoning correct here, any comments would be much appreciated.