KMD - Kathmandu

[drcjp]

personally, 7/9 and 25cps for the next 40% is affordable for Mr Duke and he'd end up with 55-60% of both BGR and KMD. TBH, he also has to prove himself in the australian market where kmd is. kmd will be getting an independent valuation which on current data was $1.90 (morningstar). if 2h numbers are better then anything up to $2.50 is possible hence my numbers

[Xerof]

There is a two week Notice and Pause requirement before you get the actual offer

here's a reference guide on T/O's, for anyone who is interested in understanding what happens

http://www.takeovers.govt.nz/assets/...5-hardcopy.pdf

[JayRiggs]

personally, 7/9 and 25cps for the next 40% is affordable for Mr Duke and he'd end up with 55-60% of both BGR and KMD. TBH, he also has to prove himself in the australian market where kmd is. kmd will be getting an independent valuation which on current data was $1.90 (morningstar). if 2h numbers are better then anything up to $2.50 is possible hence my numbers

Yeah 25cps cash sounds more reasonable. In case we miss the KMD full year dividend, it'll make up for it, assuming the dividend is at least 5cps, but as history shows, it would probably be 7c.
Rod Duke is just doing what he has to. Starting his bid low at $1.80.
I would be surprised if the KMD board accepted this. Let them bargain it out.

[Beagle]

This is good....we need a good takeover scrap to entertain those of us on the side-lines

[Harvey Specter]

Yeah 25cps cash sounds more reasonable. In case we miss the KMD full year dividend, it'll make up for it, assuming the dividend is at least 5cps, but as history shows, it would probably be 7c.
Rod Duke is just doing what he has to. Starting his bid low at $1.80.

I assume a dividend will be paid to allow the utilisation of tax credits. Though being hostile takeover, those details may not be know to be factored in.

[TheHunter]

There is a two week Notice and Pause requirement before you get the actual offer

here's a reference guide on T/O's, for anyone who is interested in understanding what happens

http://www.takeovers.govt.nz/assets/...5-hardcopy.pdf

Cheers Xerof, much appreciated!

[babymonster]

We should have kmd management recommend early next week.

[winner69]

Just as well there is such things as 'Chinese walls'

Goldman been buying heaps of KMD lately / Goldman advising Kathmandu

And didn't Goldman do well at the IPO? Part owners they were with Were and Quadrant. Got more than KMD worth today they did.

Roger, those Quadrant guys pretty clever and know when to time exits eh.

[pennyacw]

The current offer results in KMD share holders taking the majority of the risk as to whether BGR is able to turn things around and continue their success in their current business. 20c cash is very low in my view. However, with BGR already paying around $1.8 (slightly lower if you count original build of 5%) they have used now the majority of their cash in their balance sheet. Although they don't have any debt they do have a whopping $106m in operating leases - will be interesting to see their willingness to issue debt to support the takeover.

I suspect the first offer is a low ball offer giving them room to move up. How much cash they are willing to offer will be of question. I think 40c is much more of an acceptable offer when taking into account the proportion of shares vs cash.

[Harvey Specter]

The current offer results in KMD share holders taking the majority of the risk as to whether BGR is able to turn things around and continue their success in their current business.

I would have though the opposite. More than 50% of the risk is being passed to BGR and KMD holders benefit from the diversification of retail brands than BGR has.

Also, shareholders in KMD can either put their faith in a brand new CEO or in Duke who, while new to KMD, has significant experience in NZ retail.