InvestorsHub Logo

stocktrader1

07/02/14 8:16 PM

#1024 RE: flemsnopes #1023

You just might be right? Stock is steadily moving back up!

the cork

07/03/14 8:17 PM

#1027 RE: flemsnopes #1023

For all the talk we hear about a "premium" when getting bought out, that's usually a crock of chit.

What typically happens is, they offer the "premium" to the average share price over the last 6 months or what ever period.

Unfortunately, the average share price has usually been suppressed by various means (like capital raises (read dilution)) prior to the buy out announcement, so when a 30% or 40% "premium" is announced, the "premium" is way less than the share should be going for in the first GD place. Not only that, the acquiring company gets an infusion of our money at closing. Pretty Slick!

Buyouts are usually great for the acquiring company, and sometimes great for (selected) management of the acquired company. Don't expect any fiduciary ethics in play at this point. Subordinate management are hoping for a job offer so they aren't gonna rock the boat on our behalf.

Shareholders are the last consideration in the process, and any benefit to us is an unintended coincidence. Hope this works out better for shareholders. GL f