OK so Allco have changed the deal with the guys who are selling...

OK so Allco have changed the deal with the guys who are selling the Rubicon funds management deal to Allco.

Allco are paying less upfront and a higher incentive payment if the size of funds under management by Rubicon increases down the track.

This is probably a better deal for Allco and its shareholders. The market has responded.

The 64-million dollar question, how does this deal amendment affect the shareholders in RAT, REU and RJT ???

First observation, I don't know how the value "funds under management" by Rubicon ? Mkt cap of their 3 listed trusts ? Gross valuation of the properties ? Net valuation ? I don't know.


Second observation. If they plan to increase the size of these trusts, then they would be issuing new capital to expand their capital base and a buyback as currently proposed makes no sense.

Third observation. It would appear that RAT, REU and RJT are currently trading at some sort of discount to what they are worth ( barring financial apocalypse ). Thats why a buyback made sense. But now Allco/Fell have an incentive to scale up these trusts, then the issue of new units in the trust at discounted prices is probably not good news for existing investors in those trusts.

Any comments ?