If KDEB indeed revise upward take over price from 76sen to 83.6sen, KPS being the largest shareholder of KHSB will be entitle the most and largest benefit stake holder.
I don't think even if the take over price revise from 76 to 83.6sen, KHSB will follow to match the take over price so soon. This is because the take over process take time and need approval from shareholder and bursa, usually 3 to 6 month time. Investor will need to discount the offer price of at least 6% to 8% (77sen to 79sen)
There is always 2 sides to a coin, one who cannot wait any longer to dispose shares while the other who is gradually accummulating shares with patience. Although there is no further development at this juncture, there is a positive belief that the deal will materialise, looking at the gradual price increase with selling pressure well absorbed, for now.
This stock has proven that a risk arbitrage strategy is a worthwhile endeavor if the potential reward is high enough. Recalled the time when it was trading at about 50-60 sen and people were doubtful and fearful even after the announcement of the takeover was made. Joel Greenblatt, a top fund manager in US (Gotham Capital)has been beating the Dow (with a return of 50% a year) for more than a decade. For those who are interested in some of those profitable strategies, read his book, "You can be a stock market genius".
For KHSB, as it is closed to its initial offer price of 76 sen now, is it still worthwhile to sell, hold or buy some more? Of course it depends on if the offer price will be raised, if so by how much, or stays the same.
Hearing from someone who appears to have some insider information, it appears that it may still worthwhile to hold, or even buy some more. You know it is not easy to get an annualized return of more than 20% a year with that kind of risk. I hope you understand what "annualized" means.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
hng33
20,491 posts
Posted by hng33 > 2013-06-10 09:34 | Report Abuse
If KDEB indeed revise upward take over price from 76sen to 83.6sen, KPS being the largest shareholder of KHSB will be entitle the most and largest benefit stake holder.