correct calculation - worse then you think, page-10

lol, lol, lol dirty corporate ploy.

The proposed takeover bid is split into two parts.

1) Cash offer of 1 cent per share (post takeover)
+
2) Script offer: 1 FEL for 13 PDY

The 1 cent cash offer is 1 cent for each FEL share you end up with.

Using the example of a shareholder currently holding 1,300,000 PDY shares.

Current value:
1,300,000 x 1.3 cents = $16,900

Takeover value:
Script: 1,300,000/13 = 100,000 x 10 cents = $10,000
Cash: 100,000 x 1 cent = $1,000

Script + Cash = $10,000 + $1,000 = $11,000

This means that under the proposed takeover, the value of 1,300,000 PDY shares would be worth $11,000 i.e. 0.84 cents per share or a drop of 35% in value to today's closing price of 1.3 cents.

When an entity proposes a takeover, the bid is usually accompanied by a statement clearly outlining the benefits to shareholders. This is often in the form of a premium percentage to the average weighted closing price. No such statement was disclosed in Sage's bid, and for good reason. The proposed bid is for a discount of 35% to today's closing price.

It is crystal clear that today's bid will never get past first base however shareholders need to understand their real motive.......they are hoping that by 'devaluing' the sp, shareholders will dump their stock into their waiting hands.

Do they really think that Australians are that stupid?

Btw, I rang a FEL company spokesperson this arvo who confirmed the definition of the script offer as above. I was also advised that the offer was at a 15% discount to PDY closing price of 1.3 cents. RUBBISH...it's 35% - I'll be phoning ASIC tomorrow to lodge a complaint.