The Lemon Fool

The Board of Cobham is recommending an offer of 165p from AI Convoy Bidco, an indirect subsidiary of funds managed by US private equity firm Advent International Corp over a takeover deal, valuing the London-listed aerospace and defence firm at GBP4.0 billion which would reduce my loss to around 1.3%. Am I the only lemon left holding these shares? Am tempted to sell out now as this is a big improvement on recent s.p. and I should be surprised If anyone offered more.

I certainly hold, and at a modest profit, thanks to a couple of largeish buys at around 80p.

I'll probably sell.

MDW1954

The Cobham situation continues to be discussed at High Yield Portfolios (HYP) - Practical:

viewtopic.php?f=15&t=18707#top

For future reference on this board, the Cobham plc 25 July 2019 announcement regarding the recommended cash acquisition of

Cobham plc ("Cobham")
by
AI Convoy Bidco Limited ("Bidco")
an indirect subsidiary of funds managed by
Advent International Corporation ("Advent")
to be effected by means of a scheme of arrangement
under Part 26 of the UK Companies Act 2006

may be found below:

https://www.londonstockexchange.com/exc ... 62346.html

More here, once one has dealt with the disclaimer:

http://www.cobhaminvestors.com/cash-off ... disclaimer

Many thanks, PD. I'd like to think that further discussions about this bid could continue on here since one can own COB shares without being a HYPer.
Perhaps I could reiterate (since my post mentioning this must be elsewhere or deleted) that it would seem that no institutional investors have so far given an irrevocable undertaking to accept the offer and one (Silchester IIRC) has raised objections to the offer which It considers undervalues the company and it would prefer that the benefits of any future growth should stay with the current investors.

I really don't have time to read all the tedious arguments about HYP policy and historical events which are IMV irrelevant to the progression or otherwise of this bid so hope to find any further updates re this offer here.

I had been hoping that either the institutional holders or the government would intervene to prevent this opportunistic takeover but all seems to have gone quiet in that respect so the time has come to lodge votes on the resolutions at the meetings re the scheme of arrangement. I voted "No" to the first one but was surprised by the wording of the second:

"1 FOR THE PURPOSE OF CONSIDERING AND, IF THOUGHT FIT, APPROVING (WITH OR WITHOUT MODIFICATION) A SCHEME OF ARRANGEMENT PURSUANT TO PART 26 OF THE COMPANIES ACT 2006 (THE SCHEME) BETWEEN THE COMPANY AND THE HOLDERS OF SCHEME SHARES

For Against Abstain "

Is this normal? It would seem to be giving carte blanche approval to whatever modifications they chose to introduce and I'm certainly voting against that. I'd be interested to know how other Fools who still hold are going to vote. I am aware that some have already sold but as the s.p. is now below the offer price, it's a bit late to follow suit. It looks as though it will now go ahead anyway but I still want to voice my disapproval.

FWIW an article in Sunday Times Business yesterday says that "the former Chairman and CEO has accused its board of "giving away" the aerospace specialist by caving in to a £4bn takeover by private equity fund Advent International" and that the deal significantly undervalues the company.

https://www.thetimes.co.uk/article/cobh ... -b36dw0gxp

Bouleversee wrote:I had been hoping that either the institutional holders or the government would intervene to prevent this opportunistic takeover but all seems to have gone quiet in that respect so the time has come to lodge votes on the resolutions at the meetings re the scheme of arrangement. I voted "No" to the first one but was surprised by the wording of the second:

"1 FOR THE PURPOSE OF CONSIDERING AND, IF THOUGHT FIT, APPROVING (WITH OR WITHOUT MODIFICATION) A SCHEME OF ARRANGEMENT PURSUANT TO PART 26 OF THE COMPANIES ACT 2006 (THE SCHEME) BETWEEN THE COMPANY AND THE HOLDERS OF SCHEME SHARES

For Against Abstain "

Is this normal? It would seem to be giving carte blanche approval to whatever modifications they chose to introduce and I'm certainly voting against that. I'd be interested to know how other Fools who still hold are going to vote. I am aware that some have already sold but as the s.p. is now below the offer price, it's a bit late to follow suit. It looks as though it will now go ahead anyway but I still want to voice my disapproval.

Yes, I think that's fairly normal. My understanding is that while the resolution might give them carte blanche to introduce whatever modifications they want, the Takeover Panel and other regulators won't! So basically it gives them the freedom to make minor changes as required to meet concerns about adherence to the Takeover Code, competition, etc, without having to call a repeat of the meetings to approve the scheme, but not major modifications.

Gengulphus

According to an article in The Times today, opposition to Advent's £4 bn. take-over of Cobham has grown after a big shareholder (Sanderson Asset Management, which owns 2.4% of Cobham, said it was "inclined to vote against" the offer.

Silchester International, the 2nd biggest investor, had earlier said that it did not regard the offer as compelling and other bidders should be sought but two investor advisory groups have recommended acceptance and no other bidders have appeared and no auction planned so it's anybody's guess what will happen at Monday's meeting.