Anyone with shares in Asciano (AIO) would need to read the Bidder’s Statement from Nitro Corporation Pty Ltd very carefully to decide whether to take up the offer for their shares or not, as it involves cash and CDI’s in Nitro’s ultimate holding company, Brookfield Infrastructure Partners L.P (which are not yet listed on the ASX!).
The offer from Nitro comprises $6.9439 for each share held, plus .0387 BIP CDI’s (Chess Depository Interests). As the AIO shares are currently trading at $8.79, the question to be answered is .387 BIP CDIs worth more than $1.84 the difference between the share price and the offer?
To calculate this, we need to go back to the NYSE to establish the value of the BIP CDI’s which – of course are expressed in US dollars, so need to be converted to $Aud.
On 20 November 2015 (the date used to define small parcels), the CDI’s were worth $41.97 US per CDI, making the offer of .387 CDI’s per share $1.624 US. Converting that price to $A (@.72C) means $2.25 should be added to the $6.9439 cash, giving a “price” of $9.19 compared with the market price of $8.79 – a premium of .40c or 4.55%.
Of course the variation in exchange rates, the variation in the relative share/CDI prices and the impact of rounding all make the true value of the offer difficult to calculate.
However, if you don’t mind holding o/s investments (to be listed on the ASX sometime in the future) then it does appear that the offer is worthwhile.
The latest development is that Nitro Corporation (an indirect subsidiary of Brookfield Infrastructure Partners L.P.) has extended their offer until 7.00 pm on Friday, 22 January 2016.
As always, if you have any queries, please contact us.
General Advice: Please note that any advice given in this blog is of a general nature only and should not be relied on, as it does not take into account your personal circumstances. If in doubt, please contact your own financial adviser.