Category: Money Tips Date: 2006-01-18
"61" is the Children's Day, in the Children's Day on this day, raised placards Handan Iron and Steel Baosteel announced, claiming that it has acquired in the secondary market, a lot more than just a bargaining chip has reached 5.002 percent. Besides, not only that, Baoshan Iron and Steel Group, while also holding a large number of warrants market, Handan Iron and Steel warrants an amount equal to 100 million shares.
What does this mean?
Means that the acquisition of Handan Iron and Steel Baosteel for the battle may be imminent.
The total share capital of Handan Iron & Steel is now 2.764 billion shares, accounting for 1.396 billion shares outstanding, the number of non-tradable shares and tradable shares fairly. Handan Iron and Steel Group is currently holding the shares for 1.632 billion shares, 59.06% of the total share capital belongs to the absolute holding, reasonable to say that Baosteel Group have no chance. The problem is not out of the stock, but rather lies in the Handan Iron & Steel instead launched into a stock and warrants on. Handan Iron and Steel under the share reform program of tradable shares for every 10 shares of shareholders in addition to obtain a share of the right price, every 10 shares also received 7.29 exercise price of 2.80 yuan European-style warrants. This means that if the right of due-line, then the shares held by Handan Iron and Steel Group, will be a big underground to 15%, while the combined shares of Baoshan Iron and Steel in the hands of existing warrants may be the right line has accounted for 10 of the total share capital. about 3%, if the secondary market continues to overweight stocks or in the warrants market, continue to eat into the C of E more than 50%, the Baosteel likely to become the largest shareholder.
Baosteel raised placards timing just right, and good like in the Handan Iron & Steel's share price has just been no breakthrough in the net assets of 3.77 yuan for two days, and good like the Baosteel honestly admit to absorb the price of Handan Iron & Steel is 2.65 yuan and 4.40 yuan between. While Handan Iron & Steel Group, which serves as lightning reaction, the next day announced in the secondary market holdings of not more than 7 million shares of the shares, the funds of not less than 1.5 billion.
One must purchase in order to oppose a takeover. The media excited seeing a takeover battle broke out; investment bank excited, Baosteel Group, the world's fifth Seeing talk about the "great deal" story; investors excited, "said Bao Yan war" when the stock-market surge will be seeing the reality; However, the "61" section of the story that, like a child's face very quickly, as the development of things is not as you can imagine.
Handan Iron & Steel's so-called takeover battle only a day in the market interpretation of the stock market. June 1, Handan Steel shares touched a bit reluctantly intraday limit-even letters were not sealed, June 2 is the excuse is opened daily limit after the crash all the way to close the end not only failed to rise, but also slid 4% more, June 5 the third trading day is beaten intraday fall limit down position, closing down another 4.54%. Three trading days, Handan Iron and Steel from the daily limit to the lower limit, falling by more than 20 percent, while Baosteel's share price is fluctuated between the daily limit in a few cents.
Why would this happen?
Skin with water observation, Baosteel and Handan Iron and Steel raised placards notice more like a two joint co-star of the double reed, but simply does not exist the so-called hostile takeover.
One reason is because it involves such as Baosteel and Handan Iron & Steel bearing on national economy and industrial restructuring, SASAC could simply is not the final say, not on the State Council Standing Committee, such a thing simply unable to settle down. So, it does not exist for the central SASAC as represented by Baosteel and in the context of Handan Iron & Steel in Hebei Province, the SASAC game;
The second reason is because the reorganization of the pattern of iron and steel in Hebei Province. Hebei province is the largest iron and steel, and according to the planning of Hebei, Tangshan Iron and Steel Group has been re-finished, but it was due to the restructuring of Handan, Shijiazhuang Iron and Steel Plant was the original acquisition of CITIC Pacific are left stranded. Since Hebei acceptable CITIC Pacific, then why is it reluctant to accept Baoshan Iron and Steel, Hebei do?
The third reason is because the serious shortage of funds Handan Iron and Steel, but there are plenty of Baosteel's cash flow, cooperation is the natural development of a natural fit. Handan Iron & Steel stocks has launched the large-scale reform of the warrants, and the exercise price set so low, indeed hiding something. On the one hand the pre-debt-share transfer are extremely unsatisfactory, companies face enormous pressure to pay debts, while the company's cash has very limited, or would not share in the China Merchants Bank China Merchants to sell the shares before the reform in order to repatriate funds. Thus, while Handan Iron & Steel repeatedly in order to stabilize the company announced it would repurchase price, but in the end are the thunder and rain and little, which means only a superficial meaning, there is no substantive action. From the analysis of this claim that the plan is not realistic, on the one hand claim that no more than 7 billion yuan holdings of shares, on the one hand they claim that the funds not less than 15 billion yuan. The secondary market in accordance with overweight, 700 million shares corresponding to the amount of funding requirements to reach 3 billion, 1.5 billion yuan less than the number of shares corresponding to 350 million, from the huge gap between the two can see the so-called overweight is not possible to things, is rhetoric. Otherwise, why turn the low-cost 2.8 yuan to a salesman who cheapens stocks? In fact, the Handan Iron and Steel Group, if true, then the money would not be that way by substantially reducing the share of the warrants.
Of course, the Handan Iron and Steel takeover battle be fought, does not mean that Baosteel and Handan Iron and Steel will not come together. In fact, Handan Iron and Steel Baosteel net assets for less than the price of Handan Iron and Steel from the secondary market acquisition of shares is a good double-edged sword. From a speculative point of view, there is a huge profit margins, from an investment point of view, but also reduce the acquisition costs, why not? If the final two to talk about mergers and acquisitions, then the basis of net assets is a more or less have a premium because as net assets less than the price at the negotiating table is not available to them.
Handan Iron and Steel and the extension of the biggest difference lies in whether or not tradable, but rather the extension is listed as a whole, Handan Iron and Steel is only a partial listing. Handan Iron & Steel Group and acquisitions, if not willing to cooperate, then it should be the phrase goes, strong twist of the melon is not sweet, not only did not sweet, but also bitter, Baosteel will Zizhaokuchi do?
Therefore, the Handan Iron and Steel's takeover battle is only a smokescreen, would not have guns.
