The understanding is that Yanzhou can't buy stock in the market. Also the bid price is $16.95 (the 50c extra dividend is not 100% definite and is not part of the sum paid by bidder Yanzhou).
There was little movement in the trading price of FLX that tightened up all week. Friday was High$17.41 Low$17.38 (1,672,589 shares traded), Thursday and Wednesday H$17.40 L$17.35 and similar trading on Monday and Tuesday. Stock traded during the week was 6,405,239 shares.
A counter-bidder would find it easier and cheaper to buy in stock. Xstrata really needs to control Moolarben and a cash bid up to $18.20 would be on the low side with synergies covering the extra cost. Xstrata could go up to $19.50, and if all went very well they could still cover the extras on synergies alone. This miserly bid of $16.95 by Yanzhou (through subsidiary Austar Coal Mine) seems to point to a tired Management who have had enough.
FLX Price at posting:
$17.38 Sentiment: ST Buy Disclosure: Held
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