Ann: Merger Proposal Update, page-4

What do you think?

As immoral as this entire corporate group is, I'm still astounded they seemingly thought the original proposal had a fair chance of success. (Otherwise why would they have proposed it?). It speaks not only to their bona fides and hubris and arrogance, but also to their intelligence.

Now, some key points I missed in my rant above; the bold text is new:
1. If the funds all retain the status quo, 1/2/3 holders will get a big fat payment in the near term. If the merger occurs, we all get zip till Dec 2023. But even then, what we get is a vastly reduced payment, for several reasons. Firstly the RE says it plans to spend $$$ buying back CD3 stock post merger. That will screw CD1/2/3 holders for the benefit of CD4, because the cash being deployed will have come from exits of CD1/2/3 investments; CD4 is of course much earlier stage and it's also as big as 1/2/3 combined. And then secondly, a related reason, the remaining cash will be spread between 1/2/3/4 - and, again, the source of that cash will have been 1/2/3 only. And on top of all that, we get a tax liability on the sale of any units redeemed, as compared to zero tax liability on the payments we're currently getting (those payments only serving to reduce our cost base).
2. The redemption funding - and, again, they're still only planning to commence redemptions from Dec 2023 - will largely come from 1/2/3. Holders of 4 will hugely benefit from a merger, to the detriment of 1/2/3 holders.
3. E&P will still be pillaging us for FEES FEES FEES FEES FEES NOM NOM NOM GIMME MORE FEEEEEEEEEEEES.
4. CD2 gets especially screwed because of its current cash position. Per @richardwth's outstanding analysis with which I agree (https://hotcopper.com.au/posts/64167983/single) CD2 has approx 49c in cash at the Fund level. That's 22.5% of the $2.18 NTA, a materially higher percentage than the other funds have. Given where the funds are all trading - approx 40% discounts to NTA, and >50% discounts once you back out their cash - plainly the market has a lot of skepticism about whether their underlying assets will be converted to cash and if so when. But cash is cash is cash. CD2 owners are effectively being asked to use most of that 49c cash to buy assets mostly of CD3 and CD4 priced at their valuation, but which according to the market are actually worth less than half that valuation. That is a terrible, terrible deal.