MET - Metlifecare - one for the fundies?

[dabsman]

http://nzx-prod-s7fsd7f98s.s3-websit...571/312210.pdf

Original announcement was 3 weeks ago today.
My view on this is the longer negotiations go on and working groups and investment bankers work on this the greater the chance a deal will happen.

Completely agree. I bought a lot in the 4's as I could not understand the massive discount to NTA even with water tighness issues already budgeted. I think someone with a more aggressive focus will create a lot of value buying MET. MET have some amazing locations in Auckland so the brownfield opportunity just in the existing portfolio is huge

[couta1]

Boredom and impatience showing its face today but I'm following the Beagles nose on this one(If it works out I will owe him that much cider he will be incapable of standing on his skis when we meet next winter)

[Beagle]

Boredom and impatience showing its face today but I'm following the Beagles nose on this one(If it works out I will owe him that much cider he will be incapable of standing on his skis when we meet next winter)

LOL - Half the time I'm incapable of standing on my skis when sober
Yeap, I topped up with a few more this morning.

[mfd]

Market price seems to suggest either a deal is unlikely or any offer will be well below NTA. What will holders do if they are offered something in the low 600s?

[King1212]

Whether a deal or no deal...MET will be a great share to hold. With 900m project on track next 2 years plus 30m share buyback program in place just in case the deal is dropped

[winner69]

Market price seems to suggest either a deal is unlikely or any offer will be well below NTA. What will holders do if they are offered something in the low 600s?

Under a Scheme of Arrangement at say 650 that has the Boards blessing we on ST will probably have little say to what the eventual outcome is .....except protest loudly and moan and groan and vote against it to show we’ve done something

[mfd]

Under a Scheme of Arrangement at say 650 that has the Boards blessing we on ST will probably have little say to what the eventual outcome is .....except protest loudly and moan and groan and vote against it to show we’ve done something

You're probably right. NZO was a brief glimmer of people power, but also highlights the short-term share price risk if no deal eventuates.

[Beagle]

Market price seems to suggest either a deal is unlikely or any offer will be well below NTA. What will holders do if they are offered something in the low 600s?

Did you miss this announcement ? http://nzx-prod-s7fsd7f98s.s3-websit...571/313504.pdf

Its quite clear MET is entering a new phase of enhanced development. I think its extremely unlikely the board would support any deal below NTA which was $6.96 as at 30 June 2019 and could be about 3-4% more since then given property price gains since. I'd say anything under $7.25 isn't going to get support from anyone.

This is very different to the NZO situation. Underlying earnings growth has averaged 15% per annum for the last 5 years and is set to continue.
Historical PE of just 13.8 at $5.85. Happy to hold if the deal doesn't happen but I think this is a SUM - MET merger and people will get 1 SUM share for each MET and I am more than happy with that too, although will end up holding quite a SUM of SUM shares then

My contact at SUM has always replied to my emails before, but not this time.
Working groups are usually appointed when a merger is in the works.
Make of that what you will but I have drawn my own speculative conclusions.

Other evidence that a deal is likely at a reasonable price is that this would never of been referred to Jarden and working groups appointed to work their guts out for weeks on it if the deal wasn't reasonable. i.e. a low ball offer would have been kicked to the kerb already.

Probably worth noting that no other retirement company listed on the NZX trades at a discount to NTA and the lowest premium to NTA any other listed company trades on is OCA at 1.1 times NTA. I'm okay with and will support a deal at 1.1 times adjusted NTA as at 31 December 2019 = 1.1.x ~ 7.25 = ~ $8 or 1 SUM shares for every MET share because SUM shares are really worth $8 anyway

[Beagle]

Whether a deal or no deal...MET will be a great share to hold. With 900m project on track next 2 years plus 30m share buyback program in place just in case the deal is dropped

Agree 100%

You're probably right. NZO was a brief glimmer of people power, but also highlights the short-term share price risk if no deal eventuates.

Great example of people power blocking an unfair scheme of arrangement. Holders know the risks and potential rewards going forward.

[mfd]

You may be right, time will tell and it'll be a great result for shareholders if you are. However, with the share price sitting a dollar below NTA you appear to be in a minority at the moment.