Isn't it conceivable that the board of IFL thought that acquiring a well aligned business at a discounted price (I read somewhere that fairer value on MLC was $3.2B), would actually be of benefit to all shareholders in the long run? My understanding is that IFL is very capable with acquisitions and integration of other businesses. Admittedly this is a big one.... While regulators have scared the banks out of the industry it looks like a great time to buy a discounted asset.
The market doesn't always get it right and I'm still of the opinion that this is cheap - but my investment horizon is 2-3 years.
@bacci do you dislike the deal structure? Or are you just unhappy with the shareprice?
There's risk that MLC doesn't integrate properly - sure... but IFL could just run it as it is and keep it tidy and make money from it. There's integration costs so the deal probably doesn't look good for the first year for sure. Again - I see this as a short term issue.
IFL Price at posting:
$3.43 Sentiment: Buy Disclosure: Held
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