Originally Posted by
Snoopy
Blackrock aren't stupid. Hmmm let me rephase that. Blackrock are stupid as evidenced by the fact they paid up to $9.50 for MEL shares in a 'buy at any price' shopping spree. But I imagine they have learned from this, so won't be stupid twice. Blackrock has 87m MEL shares to sell and they know that the market knows this. So imagine you are that Blackrock manager with a flaming shirt from when you bought all those MEL shares for up to $9.50. Now imagine you have not been sacked (that is the part of this narrative that is hardest to believe). Thinking like a Blackrock manger, what would you do?
Well, Blackrock have other funds. So the first thing I would think about doing is moving those surplus MEL shares from the Blackrock ESG fund to another Blackrock fund. A fund that specialises in trading situations. No announcement to the stock exchange would be needed if they did this because the overall Blackrock shareholding would not change. 'Blackrock' could then go beyond the April 19th share resettlement square up date, The shorters would then panic with the share price not diving, driving the MEL share price up, At that point the Blackrock trading fund could do a couple of things.
1/ Offer parcels of MEL shares to NZ managed share funds at a small discount to the surging market price. That would keep the trading 'off market'. Furthermore the NZ funds would 'get a bargain' as the predicted sell off did not occur and they bought below the current share price surge peak.
2/ Offer some shares into the surging market themselves.
Effectively Blackrock would be 'playing the shorters', staying one step ahead of the shorters game. This strategy wouldn't get all Blackrock's money back. But it would minmise the damage. And as a Blackrock manager, 'I' just might save my job. What do others think? Is this an escape path for Blackrock?
SNOOPY