Okay this one will just be a simple post about a conversion I had with few friends of mine about some hypothetical series of events where they maybe better or worse for the investors.
As I have written in my last post, Khazanah has initiated a proposal of buying out the remaining 30% of MAS stock to make the revamping process easier. So they offered 27ct for every single unit of MAS share currently being publicly traded. Now the share price hovers around 25.5ct to 26ct, where some people are still buying at 26ct, making a very slight margin of 1ct(3.8% not too bad actually) once Khazanah bought over the share.
But that's the thing. The thing have not been finalised yet. A a matter of fact,no official letter or anything has been sent out to the shareholders. So, until an offer letter has been sent out, there are still possibilities that this could go bad or go for the better. Bear in mind that this process may take months.
How it may go bad? Obviously, govt make a revision of the offer price, Citizens not happy with govt keep bailing MA out to help certain individuals, Tun Mahathir keeps bashing the current govt for bailing out MAS and many other reasons. All these could result into reduced offer priced or the bail out not to happen at all. In the case offer price being revised to less than 27ct, the guys that bought at 26ct are pretty much screwed, and if there is no bail out, all of the shareholders are screwed. However the likelihood for this to happen is very low since Khazanah(govt) did announce their decision and that would be a very blatant way of manipulating your people. They always screw their people from every angle they could, but this would be too subtle.
How it may go better? most of the shareholders, or there are a few big-time investors in that 30% rejected Khazanah's 27ct proposal. In this case Khazanah would have to revise and increase their offer.The likelyhood of this to happen is pretty darn low too because you know why right? MAS is pretty deep in the shit and 27ct is already a pretty good deal for most investors.
Even though it is almost sure that Khazanah would proceed with the 27ct buy out, anything may happen and may screw it all up.Also, since the takeover process gonna take months with no estimated date at this moment, would you rather wait or sell them at slightly lower price (25.5-26ct) and vet the money to something else,with chances to get more return within the same period. The answer would depend your personality and what kind of investor you are
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