Why do you think Ruffy had to borrow the money? The original...

Why do you think Ruffy had to borrow the money? The original bidder’s statement Section 9 said “the maximum amount that Bennamon could be required to pay under the Offer is $118.4m, plus transaction costs. Kin Group etc has available to it cash reserves (being $48.4m deposited at Australian banks required to fund the difference between the amount available under the [ANZ $70m] Facilities and the Maximum Offer Amount of $118.4m. ANZ Bank has agreed to provide the fullamount of the New Facilities, being $70 million”. [I can’t find any update for extra cash to fund the $27m extra needed by the 16c rise under the second bid -i.e. whether he got ANZ to fund that]

He only needs to accumulate less than 1.3% andthe creep provision allows for 3% per every six months. RG is not allowed to buy ANY more shares for 6 months, per the Takeovers Part of the Corporations act. (SS606 and 611) It is true that once this 6 month periods is over (after 7 December) he can use the creep but not before then. I have posted about this several times.

Unless the TIC founders can get >10% he doesn'tneed to negotiate with them and knowing Ruffy he will not. Not necessarily: there are 4 or 5 large holders. Extensive work by WT has shown that including TIC they hold about 9%. They have all indicated that they didn’t intend to accept the bid. Then there is a remainder of about 3% held by the other 1500 approx shareholders. Some of these may sell on market in coming months- perhaps below 84c-but RG is prohibited from buying any shares for 6 months, so my guess is that those shares would end up in the hands of the top 3 who are definitely anti RG or with others who would presumably want a higher bid. However, there is a much more important constraint in the Takeovers Law- seebelow.

As I have posted before, the Compulsory Acquisitions power inthe Takeovers Law has two thresholds, BOTH of which must be satisfied. Unfortunately, many people know about the 90% rule but not about the other part.. As summarized by the Takeovers Panel “A bidder under a takeover bid maycompulsorily acquire any remaining securities in the bid class if during, or atthe end of, the offer period, the bidder and their associates have:

• relevant interests in at least 90% (by number) of the securities in the bid class and
• acquired at least 75% (by number) of the securities that the bidder offered to acquire under the bid (whether or not the acquisitions happened under the bid).

Chapter 6A sets out the requirements for any compulsoryacquisition process.”

Under the first bid RG started with 50% so the second limb of the law meant that he had to reach 87.5% +: that was redundant because the first limb required at least 90%. These numbers now become crucially different for a new bid. To achieve CA in a new bid from here, and only when he is allowed to amount one after December, RG must achieve both 90% and [88% (today’s holding) + 75% of (100-88)%] = 97%. He must achieve both. The 90% limb now becomes redundant as he must also exceed the other test (97%), which is much harder. I haven’t calculated the exact number- we will have to wait to see his next 3Y to do that- but at a minimum he will need to exceed 96% to be allowed to use CA. This means that TIC founders can-on their own- block any NEW attempt to achieve CA. It is true that the law does allow a bidder to go to Court to prevent an extreme case of greenmail by one holder, but this has been rarely used. If there were many holders (big and small) who refused to sell, especially if there were hundreds of small investors, it’s unlikely that the court would allow RG to force everyone to sell

Not advice. DYOR