Hope everyone had a quick look at this year's AGM Resolutions.
While many of the resolutions are "same old same old", I'm keen to hear what everybody thinks of Resolution 5 which (if approved) means that proportional takeover of a shareholder's total holding is allowed.
Correct me if I'm wrong, but I gather this means, for example, Google Australia wants to make a take over bid for Nearmap, they can either pay a massive premium (eg. like over 100% above market price) to try and acquire all NEA shares, or in the case of a proportional takeover situation, they might bid at only 30% above market price to try and acquire a 20% stake of Nearmap. But even at 20% ownership, this will effectively be a controlling stake in the company.
I'm keen to hear what everybody thinks about this insertion into Nearmap's existing company constitution.
My thoughts are split in deciding on Resolution 5:
On one hand (although in my opinion this is unlikely), approving this could mean one day, if most of the shareholders are happy to sell 20% of their entire holding at only a 30% market premium, then as shareholders, we are effectively helping to "lower the bar" for a third party to eventually takeover the company.
On the other hand, if we did approve this, then helping one or more third party companies in making "proportional takeover bids" (regardless if they are successful or not) could in fact generate lots of interest for the stock, appreciate the stock price, and could assist in cementing HARD Price Targets for Nearmap's ongoing company valuation.
What's everyones' view on this?
NEA Price at posting:
$2.58 Sentiment: Buy Disclosure: Held
