This indeed is disappointing. The reality is it is still below fair value, particularly if you think about the replacement value of the marine licenses in Tassie which are nigh on impossible to get these days.
To do this the day of the AGM is also a bit weak. They should have reported to the shareholders, or brought forward the annual reporting, so that an informed discussion could be held. Moreover, as I wrote to the board in late July, they ought to have directed the annual report towards articulating what they think is fair value, and why they believe the company is under valued. To go from $4.85 "The company is woefully undervalued and we won't even negotiate with Cooke" to $5.23 "That's a great bid and we should all accept" without any updated reports is unsatisfactory.
What is most disappointing in this is that the Board didn't open up the company's books to other potential bidders. If they had decided they wanted to sell, then they should have made this a much more open process. Huon was able to get a huge bump from their initial offer because they had Grant Thornton (that right?) run an auction process for them. They got bids coming out of the woodwork. I think they went from <$3 on the initial bids to closing at $3.85. Meanwhile, the Tassal Board have accepted Cooke as the only contender, and essentially gone from $4.85 to $5.23 (though they are reporting $4.67 as the initial bid). Goldman Sachs, what a woeful effort. They should get nothing for barely getting a premium on the initial bid.
TGR Price at posting:
$4.89 Sentiment: Buy Disclosure: Held
