27-04-2014, 01:34 AM
(27-04-2014, 01:21 AM)Boon Wrote: [ -> ](24-04-2014, 12:15 PM)GreedandFear Wrote: [ -> ]My biggest concern is whether Nan Fung will start to inject their China assets iinto Forterra and fund that through the issuance of more shares. I guess that scenario is mitigated by (1) currently there is little investor appetite for Forterra shares, (2) I am not sure whether a rights issue would be fully subscribed and (3) if Nan Fung sold its assets to Forterra in return for Forterra shares, that would, presumably, trigger a mandatory offer which I am not sure whether Nan Fung really wants. On the other hand, scenario 3 would allow Nan Fung to get hold of a a significant amount of Forterra shares at a large discount to NAV (if the shares were issued at today's price) and if the GO was not fully successful Nan Fung would then be left with a large share holding in Forterra at attractive prices compared to NAV which may suit them......
I could be wrong on this but here are my thoughts
If NF were to inject assets into FT in return for FT shares
1) Depending on the deal size, “the proposed asset acquisition” may need unit-holders approval (>50% majority vote would be required).
2) Unit-holders approval would also be needed (>50% majority vote would be required) for the issuance of new shares.
3) Due to conflict of interests, NF may not be eligible to vote
4) If the deal is deemed unfair to them by non-controlling unit-holders, they would vote against it.
5) The proposed acquisition would trigger a GO.
(vested)
Couldn't NF simply add a 'whitewash resolution' to the EGM resolutions to seek approval from unitholders to waive their right for a GO ? I believe LK has done it previously with First REIT.