Ann: CMG Scheme Implementation Deed with Recruit, page-2

Very nice belated Christmas gift! Congratulations to all holders (some long-suffering)!

Goes to show that some ASX shares with unreal dividends aren't "dividend traps". They are sometimes the victims of market misperceptions.

CMG's depressed price (29 cents -- really!) implies that nobody believed in the company. Yet the CEO and CFO made it clear in Aug and Oct that the business overall is OK and had good cash flow (very soft in recruiting, but very nice in managed services). In a rare show of discipline, I ignored the market sentiment by doubling our holding from August through December. I didn't expect much business growth anytime soon (maybe in 2016 or 2017), but it's a stable business overall with good cash flow.

Contrary to the market price, broker consensus has been locked on positive for as long as I have held shares (about 18 months). Both brokers advise a solid buy with target price of 45 and 50 cents. So Recruit's offer price is a small premium to the consensus target price.

Still,  I'm saddened that there is one less ASX-traded company of good quality to invest in. (I've had others -- ENV most recently.) The offer price will soften the loss of the CMG investment, but still a loss of ASX investment opportunity.

One other observation: CMG's 1.7 cent fully-franked dividend is a nice jump from the 1.4 cent dividend paid this time last year. If a planned increase, CMG would have a 3.5 cent annual dividend!

Here is Reuters' news on Recruit's acquisitions (CMG and Peoplebank):
http://www.reuters.com/article/2015/01/14/chandler-macleod-recruit-holdings-idUSL3N0UT2A220150114