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Should brokers accept Recommended Offers by default?

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Should nominee brokers accept Recommended Offers by default?

Yes
1
8%
No
10
83%
Don't know
1
8%
 
Total votes: 12

BobGe
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Should brokers accept Recommended Offers by default?

#161392

Postby BobGe » August 23rd, 2018, 2:34 am

Seeking opinions:
With regard to takeover proposals, should nominee brokers accept Recommended Offers on behalf of clients (nominators) by default?

Alaric
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Re: Should brokers accept Recommended Offers by default?

#161461

Postby Alaric » August 23rd, 2018, 12:12 pm

BobGe wrote:Seeking opinions:
With regard to takeover proposals, should nominee brokers accept Recommended Offers on behalf of clients (nominators) by default?


What should happen if there was more than one offer? If relevant assume the Board recommended only one of them.

ursaminortaur
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Re: Should brokers accept Recommended Offers by default?

#161495

Postby ursaminortaur » August 23rd, 2018, 2:22 pm

BobGe wrote:Seeking opinions:
With regard to takeover proposals, should nominee brokers accept Recommended Offers on behalf of clients (nominators) by default?


Of course they shouldn't. Ideally they should provide a mechanism for clients who hold shares in the affected company via their nominee account
to vote as they wish. However if that either isn't possible or the client decides not to vote then the broker should not vote one way or another since their votes which weren't approved by their clients could make the difference between a takeover going ahead and not going ahead. Morally it would be reprehensible for a nominee broker to take that power for itself.

Alaric
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Re: Should brokers accept Recommended Offers by default?

#161506

Postby Alaric » August 23rd, 2018, 3:21 pm

ursaminortaur wrote: Ideally they should provide a mechanism for clients who hold shares in the affected company via their nominee account


ii using the software inherited from TD Direct have a standard process, which they also use for Rights issues. There's a flag that comes up when you look at the portfolio (email notification as well if activated). This takes you to a page which gives details of the offer and an acceptance option or two. The default is invariably to do nothing, which covers them for those who don't reply.

UncleEbenezer
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Re: Should brokers accept Recommended Offers by default?

#161625

Postby UncleEbenezer » August 23rd, 2018, 10:39 pm

ursaminortaur wrote:
BobGe wrote:Seeking opinions:
With regard to takeover proposals, should nominee brokers accept Recommended Offers on behalf of clients (nominators) by default?


Ideally they should provide a mechanism for clients who hold shares in the affected company via their nominee account to vote as they wish.

Agreed (mine does - and I've exercised my rights a few times). And give Clients the at least the option to sign up for alerts whenever there's a decision to be made regarding a holding.
However if that either isn't possible or the client decides not to vote then the broker should not vote one way or another since their votes which weren't approved by their clients could make the difference between a takeover going ahead and not going ahead. Morally it would be reprehensible for a nominee broker to take that power for itself.

Disagree. A broker might have a policy of never voting on behalf of clients in corporate actions, or one of acting in clients' best interests. There will be cases (perhaps most often in closely-controlled small-caps) where one or another vote is pretty clearly prejudicial to minor shareholders. And as soon as you accept the broker might vote in *some* cases, you're in the business of drawing a line through a grey area.

What a broker should do is, whatever their policy, be clear about it. So someone like you who feels strongly could select a broker who will act as you see right.

BobGe
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Re: Should brokers accept Recommended Offers by default?

#162125

Postby BobGe » August 26th, 2018, 5:43 am

UncleEbenezer wrote:Disagree. A broker might have a policy of never voting on behalf of clients in corporate actions, or one of acting in clients' best interests.

How can a broker know that they are acting in clients' best interests? Might one client not have a different view of that to another? What if something thought to be in clients' best interests in the moment turns out to be questionable later?


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