Only if you bought below $5.80 otherwise the takeover upside potential far outways any current trading potential, I wouldn't trade it now.
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Easy no risk gains for traders it has been though. Potential involves risk. Good luck to all.
Of course, if the deal has to start with a 7 then it may well not happen at all.
Could well be - the potential list is long. In over 50 years' investing I've lost count of the number of times I've held shares in the target. It's not unusual for these matters to take longer than expected, although Christmas does add an extra touch of urgency. Patience, holders!
:cool:
So just read on facebook NBR post (I don't have a subscription to NBR) that MET will update the market on Friday.
Believed to be a private equity buyer...
So wave bye to another NZX listing??
Interesting...thanks for sharing.
A firm offer has been submitted!.....good news...
"Retirement village operator Metlifecare is expected to update the market on Friday about a proposed takeover offer.
Private equity buyer understood to have submitted a firm offer".
NBR Facebook post posted 2 hours ago.
This is going to be interesting. They've certainly well and truly "kicked the tyres" on this company so let the games begin.
I think the most interesting comment in today's NBR story is this:
"Ellis said the board was likely to provide a further update by Friday 'but I wouldn't hold your breath on what it's going to say.' "
Read into that what you will but it doesn't sound overly positive to me.
Was..... likely....now done deal. Trading halt tomorrow...
Usual gamesmanship. Board will think the company is worth considerably more than NTA because of its growth potential. Private Equity will want it as cheap as possible.
Its time for the board to front up with what's going on. They really should do that tomorrow and let shareholders decide for themselves what they want to do.
Mighty glad it’s not Summerset playing silly buggers ...huge sigh of relief
About 2 years ago Infratil sold their 20% share in MET - NZ Superfund retained their 20%
The share price at the time was $6.07
Been a bit dud investment for them over 2 years when the markets have been going gangbusters - lost opportunities big sum
Wonder what they thinking of doing now? Maybe even influencing in the background?
I made my first investment in 1962 or 1963. 100 shares in Mt Isa Mines (fore runner to BHP). Paid 26 shillings each and 6 weeks later they were at 42 shillings. The miners were on strike when I bought and the SP shot up when they returned.
Never forgotten this - I was so elated at the time and it was a great start to my investing career that's been on and off for about 57 years.
Top 3 'active' shareholders being NZ Super, ACC and ISG Ltd own 32% so it is inconceivable that the Board & bidder do not interact with them.
Means that they are bound by confidentiality and cannot trade any shares until such time as the deal is confirmed on or off.
Add on ANZ Bank various investment funds' 11.8% and the top 4 shareholders will deliver control if they like the price offered by the bidder.
Thanks for the info Balance. Under the takeovers code as I am sure most will know already, if they bid for more than 20% they have to bid for the lot. I estimate NTA as at 31 December 2019 to be about 2-4% above the $6.96 figure as at 30 June 2019.
The $64,000 question for shareholders to ponder is have management done enough over the last 2-3 years to justify a bid above NTA ?
If you're tempted to answer no like I am then consider whether the Auckland market is what's been holding them back and now that the tide appears to be coming in again with regard to Auckland property, whether a premium is justified based on how well the management have done in a falling Auckland market in the last 2-3 years.
These are difficult questions but I can't help but refer back to my 5 year analysis which showed average growth in underlying profit across 2 stages of the property cycle of 15% per annum, better than RYM's underlying profit growth over the same period.
For me, RYM is the benchmark and given MET's heavy concentration of property in Auckland and the Bay of Plenty, compared to RYM's much greater geographical spread I think on any rational and objective analysis MET's management have beaten RYM which is the benchmark so must be considered to have done well.
With the outlook for Auckland property now looking brighter and MET morphing its business model to move more towards a more comprehensive care model, I don't think any bid at a discount to NTA is warranted.
OCA in the sector is now trading at a premium to last recorded NTA of just over 16%, (does not have the 5 year established track record of underlying profit growth) and the rest as everyone knows are trading at much greater premiums to NTA.
It must be at least at NTA as at 31 December 2019, so about $7.20 as an absolute minimum.
For a second there I thought the bid had been announced at $6.40 lol, The barking would be fierce lol
They've done enough so no discount to NTA could be considered as being fair and reasonable.
If it is indeed a private equity bidder, then they are not buying MET for what it is and certainly, they will be bringing in their own management team while retaining some of the existing team if appropriate.
And knowing private equity modus operandi, it will be a case of using MET to facilitate more investments in the sector with the view to resisting it or selling it in future.
So I think that management of MET will be resisting this takeover while Chairman Ellis with his 250,000 shares will be wanting a high price.
Sentiment against Auckland property has been quite sour up until quite recently but the worm has definitely turned so its onwards and upwards from here regardless of what happens with this possible takeover :t_up: :t_up: Important to note that before sentiment turned sour against Auckland property the MET shares were in a nice uptrend and the price was $6.50 and that's without any takeover premium ! Attachment 10905 (Note the price in October 2018 !)
It's not a long term hold for me so I'll take any reasonable offer and be thankful.
That rumour NBR spread yesterday hasn't done much to price today
GOTTA BUY MORE MET is a better ramp
"I can't help but refer back to my 5 year analysis which showed average growth in underlying profit across 2 stages of the property cycle of 15% per annum, better than RYM's underlying profit growth over the same period". The facts and numbers suggest their track record is actually very good. Maybe its a much overlooked diamond in the rough ? House price growth expectations looking very positive going forward. https://www.scoop.co.nz/stories/BU19...pectations.htm
its spilled
$6.50 offer rejected
https://www.nzx.com/announcements/346335
Offer could easily be revised and / or one or both of the other interested parties could table an offer.
Holding.
Update on Takeover After careful consideration, the Metlifecare Board has formed a view that the value per share of the company is above the price of the revised NBIO. The valuation of the company is particularly sensitive to house price inflation (HPI) and construction cost inflation. Depending on the assumptions adopted, the valuation ranges to in excess of $8.00 per share.Following confidential institutional soundings, a binding offer at $6.50 per share is unlikely to be supported by the requisite majority of shareholders voting. In particular, the Accident Compensation Corporation, Nikko Asset Management, and Generate have advised they would vote against such an offer.
S/P heading up atp. $6.50 new floor?
Probably dead in the water, no way anyone's going to pay $8 plus for this, they are kidding themselves.
I like the $8 valuation comment...
You should read it again. Up to $8 depending on house price inflation and building cost inflation assumptions. There's always a range to the value of a business depending upon valuation modelling.
I am interested that there are 2 other parties interested. JT could have a point and $6.50 could be the new floor given this company is still in play, (initial rejection of the first initial offer by one of the parties given there are three interested is by no means the end of this).
MET should restart the buy back... could improve the SP!
sounds like another STU here... offer gets put in there, board comes back and trumpets how great they are and wants more based on various (lofty?) assumptions, offer goes away and share price collapses back to pre-take over notice. (as for the two other parties, they were probably only willing to offer $5, maybe $6 tops)
Will be intriguing to see how things pan out... $6.50 and $8+ is quite a large difference I would think.
Hey winner what you going to do? wait or cash up for Christmas, think I'll toss a coin.
Okay, yes, the valuation range extends to $8+. This does not mean an offer at say estimated NTA as at 31/12/19 of $7.25 would be rejected. I think its well worth noting that the board told the credible interested buyer that $6.50 was below its view of fair value (indicated that it would not be supported), but the party went ahead with expensive due diligence anyway. Join the dots, I think its very unlikely their first offer will be their last especially now its clear there are two other interested parties.
"Metlifecare has recently communicated these circumstances to the third party. Although it is possible that the third party might put forward a further revised proposal, there can be no assurance that any such offer will be made or that an offer may emerge from the other parties that have expressed interest"
There are multiple parties interested in a takeover. Blind Freddy could tell you the stock is "in play".
If ACC and other institutions are not taking $6.50 then neither am I.
I've got a bucket load of these on margin, I'd be happy to see a bit more price but wouldn't want to lose this one. Watching very carefully.
High as $6.15, holding $6.10 atm.Be plenty taking their profits atm.Congrats.
Closed at $6.12 up 12 cents. Its going to be fascinating how this plays out. I'm up for this and committed to hold while its well under fair value which I assess at $7.25
I have no need for extra cash for Christmas but completely understand if others do or want to take a quick profit.
Mr Market only agrees they are too cheap because there is a prospect of a takeover, which Mr Market deems, at this point in time, would go ahead.
If there is no prospect of quick easy money, I highly doubt we would see the share price anywhere near this high... hence it will be intriguing to see what eventuates.
So MET and their expert advisors update their models (presumably DCF models) and come up with $8 plus as a value
We know what some on here think of DCF’s - pretty meaningless and just a heck of a lot of guesses (sorry assumptions) about where things are going well into the future and then apply a discount rate to get the answer you want
Wonder what their “low” scenario is?
Announcement a bit like Labour release of harassment claims yesterday
Wait until the journos are at a party and hope nobody notices
Probably many broker / analysts / fundies have gone for the year (got to beat the traffic jams and the disruptions to AIR flights) and having a few drinks to reflect on the year just gone
I'm with Beagle on this one. The offer has thrown MET into play and others are, or will be interested now. Admittedly, it's easier to be patient if one doesn't need the money in a hurry.
Attachment 10906Attachment 10906
My friend Crackity sent me this.
I can't comment on your weight :) but agree that a better offer is quite likely to come. I guess - seriously - who in his/her right mind would make their first offer as well the last and best? And the fact that there are several interested parties makes the whole thing much more interesting.
Holding a medium sized parcel myself and quite relaxed at the current share price. No need to rush to the sell button.
Agree 100%
They tell the board the NBIO is $6.50. Board tells them its not enough but agrees to allow due diligence. They do a whole month of thorough due diligence anyway spending all that time on it and knowing all that time that $6.50 is unlikely to be enough and knowing that under the takeovers code they're up for MET's professional costs including legal and Jarden. They then bid $6.50 and the board sounds out major shareholders who also say its not enough.
In the meantime two other parties express serious interest. Honestly, I would speculate its highly likely there is a better offer forthcoming in due course. Probably negotiations are happening with major shareholders at present and may conclude over the weekend.
Increased offer next week ?
At the grave risk of being dogmatic, Its got to start with a "7".
Its interesting, but not in a good way that the valuation boffin's can only get to 10% above NTA (assuming NTA is now $7.25). Most comparator companies (RYM, SUM, ADV) are over 40% above NTA and even OCA had a trade today at 20% over NTA. MET management need to have a good look at what everyone else is doing differently &/or better. A small clue would be their new build rate. Till they do that and make some changes, a bid at NTA would probably change the management team running MET.
If there was a good reason that these other companies multiples to NTA were to become applicable to MET, the valuation models should be able to kick out a $10+ valuation and that doesn't require using RYM at the comparator.
Bang on the money mate. With two other interested parties nipping at their heels, the bidder will want to wrap up negotiations with major shareholders over the weekend and present this as effectively a done deal next week, in my opinion.
$7.25 is where I called it many pages ago. Allows everyone to save face, (small premium to 30 June 2019 NTA), and leaves plenty of meat on the bone for the bidder.
Extremely tempting to short-term trade this, but I feel like the burn from the deal not going through will be extremely painful given the leg-up in shareprice already lol
Hope there be some speculative buying today and pushing price up to $6.40 odd ...or will the market see the announcement as a big negative.
Even that’s cheap as - I hear it’s worth at least $8
Wow $8....where u heard it from? Naughty Jarden's someone. Absolutely no no these days....end of career...lol
Another dollar will only make Met....$1.5b market cap...I think we will get another higher offer....
I know Winner. . just joking 😄
So the answer to you question still has to be NO ...they (Met Board) haven’t done enough to get the market to recognise what MET might be worth.
Well respected Board but I think they’ve been a bit slack in this respect (been running the company operationally OKish rather than raising the profile of the company if you get what I mean)
And now we have to put our faith in thevsame Board to actually get a good price for us
I think they could have been more proactive with the buy-back. I've said it before, buying back the companies own shares in the mid-late $4's was a complete no brainer at such a deep discount to NTA.
Maximum in any one year as I understand it is 5% so that would have been 5% x 213m shares = 10.65m shares at say an average of $5 = $53m allocated. They allocated just $30m to this process despite having a ~ $900m development pipeline over the next 3 years so yes I would agree a more proactive stance should have been taken and it shouldn't have taken shareholder activism to get them to do this.
3 Parties interested. I am quite confident someone is going to pay at least the net tangible asset backing of just over $7 (estimated at 31 December 2019).
Patience is all that's required here from shareholders. Remember the market is often a place that shifts value from the impatient, to the patient :)
I'm not a super clever investor like many, however, other than a quick sale and easy buck, have trouble finding a down side to yesterday's announcement. At the moment, SP is $1-2 undervalued. Plenty of smart heads supporting this and the fact 6.50 was rejected also supports. PE also very favourable. Today will be very interesting. Simple thinking tells me, it's a screaming buy opportunity. This will go against those who are disappointed in lack of quick buck so exit. So SP could go either way in the very very short term but not far away I expect good things. This could come from many corners. I'm holding all mine. Thanks to all for your insights too, I enjoys all the great info shared.
Sellers drying up shes off to the races.
More fun on here than at the races.
In an interesting development this morning one million shares have just crossed at $6.15.
Tempt to punt is growing daily especially with volumes today.. possible 8$ valuation. But jesus will it be painful if it doesn't go through haha
Only the weak minded hands will sell now? i'm tempted to sell or should I hold out and wait for the revised NIBO offer at $6.70 - $6.80?
I think i'm going to sit this one out, I feel like my decision to enter would be greed fueled rather than a fundamental decision. I do envy holders who bought in prior to the take-over talk. But on reflection I never researched this sector and therefore can't say I really earnt any of the winnings.
Should the deal not go through I probably will enter if it falls right back down with the hope of future renegotiation
https://stocknessmonster.com/trades/met.nzx/
According to this the large volume was a sell-off... anyone know how accurate this website is?
Any trade is a sell off by a willing seller and a buy in by a willing buyer. It is nonsensical to consider only one side of the trade, because then it would not be a deal.
The red bar only indicates that the agreed price was below the previous trade (clearly a volume discount) ... and yes, they got that right.
That makes more sense, I only found out about the website recently and didn't realise the negative just meant lower price than before ..opps haha
Not exactly a big rush to buy MET today is there
Becoming a nonevent?
Not a rush to sell either. I guess it's now the good old game of patience once again. Hopefully, not too long with this one.
The tip for Fearless originated from Jardens ...and it ran nowhere ....got to pick your advisors better I reckon