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Introducing the LemonFools Personal Finance Calculators


Covering Market, Trends, and Practical (but see LEMON-AID for Building & DIY)
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Postby Clitheroekid » December 31st, 2017, 9:02 pm

I bought into IWG in October after the SP dropped by nearly a third after a profit warning. The company is better known as Regus, a supplier of short-term office accommodation.

I'd bought at £2.10 as a trading opportunity in the hope that the reaction had been overdone, and in the hope they would bounce back for a quick profit. Unfortunately they didn't, and the SP gradually drifted down to around £1.92, though they did pick up to £2.02 just before the break. I was beginning to think it was another short term investment that had turned into an inadvertent long term investment.

I was therefore pleased to read in the press after the markets had closed just before Christmas that a takeover approach had been made by a Canadian private equity group, and eagerly awaited the re-opening of the markets after Christmas.

Sure enough, the price has now jumped to £2.57, which is highly gratifying. However, from what little I've been able to find out no definite offer has yet been made, and they have until 20 January to put up or shut up.

I'm therefore in a dilemma as to whether to sell in the market or wait and see. There have been a couple of mentions of rival bidders, which could obviously be beneficial to the SP, but I'm wary of looking a gift horse in the mouth and losing a handsome profit if for any reason no actual bid materialises.

I confess that I'm struggling to understand the situation. Why would the bidders say they were thinking of bidding but not make an actual offer? is it because they want to do due diligence before making a decision? I suspect it may have something to do with the Takeover Code, but not being a City lawyer I know very little about how this operates in practice.

In order that I can make a more rational decision as to whether to sell or hang on I'd be grateful for any comments on either the perceived value of the company itself or the possible reasons for the lack of a specific offer.

I realise it's a long shot, as there isn't one mention of IWG in the whole LF site, but no harm in asking ;)

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Postby FredBloggs » December 31st, 2017, 10:21 pm

No idea. But a profit is a profit if you sell. No such thing as a bad profit.

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Postby kempiejon » December 31st, 2017, 11:20 pm

I hold IWG, bought as Regus 6/7 years ago. Summer this year I sold about half my holding near a high. I'll be holding on, I looked at perhaps buying more as around £2.00, I thought they were worth it, I agree the drop looked overdone. The takeover talk and associated uncertainty and lack of clear details has made me reconsider that for now.
In your position, with a pretty good profit, around 25% in a few months, there are worse ideas than banking that and look for another opportunity without excluding a revisit after the details come out.

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Postby DiamondEcho » January 1st, 2018, 5:09 pm

I find ADVFN worth keeping an eye on in circumstances like this of a smaller company less widely held or mentioned on TLF. There are so many boards on ADVFN that you can usually find informed discussion on even the nichest of topics. Just be aware the moderation is pretty relaxed so you will likely notice the presence of some nutters too.
The piece of news you mention is currently being discussed - ... 087&from=1

p.s. In the circumstances you mention one approach is to sell half your position now, and wait and see what happens. ... That said, if a pessimist did that I suppose they'd feel they'd lost out what ever the final outcome :lol:

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