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30/03/21

20:06

Post #: 52153579
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Originally posted by hippo567: ↑

Notably the DEG 2020 annual report shows the top 20 shareholders as of June 30 held 66.3% Since then KLA has sold its 2.8% but Jupiter has bought about 6% and DEG management reports that retail has been selling and institutions buying so the concentration of ownership would be greater now.

A scheme of arrangement (effectively a takeover, like what happened to BAL) requires 75% support from the targeted shares and a majority of the owners of targeted shares, so if the top owners conspired they could try to buy out retail investors if 75% of retail votes agreed to it. A small number of retail investors could block the scheme. A scheme of arrangement makes sense if less than 60% of DEG's ownership decides to buy out everyone else, then to block it the opponents need more than 40% x 25% = more than 10% (but need to get turn out at meeting which is hard to arrange sometimes), whereas a conventional takeover where a blocking stake is 10% may make sense if more than 60% of DEG's owners want to buy us out and say up their stakes proportionally and/or invite in a major gold miner. Regardless the price would have to be very attractive. Plus there are various other legal conditions. A scheme of arrangement usually leads to delisting but the owners would possibly want to retain the ability to sell on market.

https://www.allens.com.au/globalassets/pdfs/sectors-services/ma/takeovers-handbook.pdfIf institutions run out of naive retail shareholders to buy from on the ASX they may get more aggressive and push for a scheme or takeover.

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"If institutions run out of naive retail shareholders"

Sadly, I don't think they will. Imagine there's quite a few daytraders as well that they can snare shares off. Hope $1 holds tomorrow with this gold selloff. Even though the SP doesn't necessarily appreciate when gold rises, it does seem to be enough to transfer shares from retail hands when it falls.

DEG Price at posting: $1.02 Sentiment: Buy Disclosure: Held
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