take over, page-2

The $8.5m is about 17 cents per share, the amount to be returned as capital (assuming ATO agrees). When the business is taken over, all assets, including $12m of cash, goes over to the new owner. Mr Loh as 60% shareholder, gets $5m back as part of the capital return. So in effect, Mr Loh is paying $3.5m to buy a business, with net assets of over $15m. That's 20 cents in the dollar.

There are some substantial tax benefits to minority shareholders from the deal, assuming the ATO rules that the capital return is tax free.

I am setting up lobbying representation for minority shareholders, as I believe $8.5m purchase price is way too low for a debt free cashflow positive business holding $12m in cash. Please indicate your interest by posting, and I will talk to HC admin about how we can get into contact.