Just trying to understand how this could possibly work.
- The bigger fish eyeing the smaller fish would organise a friendly to broker to sell into the market in time of lower liquidity, to scare the shareholders and reduce the price (then try to buy back while keeping the price suppressed).
- Then, after suppressing the price artificially for a period of time, launches a takeover at a "generous" percentage above that artificial price.
For this to work (if I've got it right), there would have to be collusion and anti-competitive behaviour. To prove this behaviour, a court would have to find the interaction between big fish and friendly broker.
I have no doubt that this behaviour does happen, but I have no idea if it is happening in this case (or our case). If I was a CSE SH, I would be asking serious questions.
Controlling market forces is a big ask, but perhaps possible with small caps.
Then again, I honestly can't explain the apparent loss of confidence in these companies in any other way, especially with the underlying indices so favourable.
Any thoughts from resident company law experts?
Cheers,
John S.
P.S. Wobbly, could you possibly show the other variables you used for the options calcs?
GBZ Price at posting:
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