Some thoughts:
1. There is a difference between having a major stake and a controlling stake (as of yesterday, Indofood now owns 51.62% of all CMZ shares).
2. It doesn't make sense to burn money to prop up a shell company, let alone take a shell company private, unless, of course, there is some kind of exit strategy, which I don't see. If you do, please enlighten me.
3. There are many dangers if major shareholder like Indofood did not support China Minzhong at this juncture.
Firstly, artificially depressed share price may put China Minzhong' at risk from corporate raiders.
Secondly, it may greatly affect the credit rating of the company, which will affect the ability of the company to raise cash, and in the worst case go bankrupt.
Third, if enough doubt is raised about the company, it may trigger a series of costly lawsuits, which may put its operation at risk and aggravate point 2.
4. I am not sure what China Minzhong management could have "offered" Indofood in exchange for a few hundred million SGD worth of cash.
5. There is just something circular about Glaucus using Minzhong's own SAIC filings to expose China Minzhong. There must be at least some level of original third party independent research, or resource here, for their argument to be more convincing.
My 2c.
1. There is a difference between having a major stake and a controlling stake (as of yesterday, Indofood now owns 51.62% of all CMZ shares).
2. It doesn't make sense to burn money to prop up a shell company, let alone take a shell company private, unless, of course, there is some kind of exit strategy, which I don't see. If you do, please enlighten me.
3. There are many dangers if major shareholder like Indofood did not support China Minzhong at this juncture.
Firstly, artificially depressed share price may put China Minzhong' at risk from corporate raiders.
Secondly, it may greatly affect the credit rating of the company, which will affect the ability of the company to raise cash, and in the worst case go bankrupt.
Third, if enough doubt is raised about the company, it may trigger a series of costly lawsuits, which may put its operation at risk and aggravate point 2.
4. I am not sure what China Minzhong management could have "offered" Indofood in exchange for a few hundred million SGD worth of cash.
5. There is just something circular about Glaucus using Minzhong's own SAIC filings to expose China Minzhong. There must be at least some level of original third party independent research, or resource here, for their argument to be more convincing.
My 2c.