Axis-shield Share Discussion Threads

[scobiebreasley] 21/9/2011 17:48

Great post stuffee - thanks.

[stuffee] 21/9/2011 17:37

Hotfinance, Tratante et al

I feel action of Alere and Axis shareholders' response entirely logical to date.

Any shareholder is nuts to accept any hostile bid until bidder has declared bid "final". A bider is not allowed to increase bid therafter unless another bidder emerges.

I suggest Alere has pursued the correct strategy of not increasing bid or declaring offer final till after Axis' last response to its shareholders, which it made on 19 Sept; under the detailed terms of its offer, as set out in document, Axis is not allowed to publish any more financial info or goodies post 19 Sept.

Alere must now consider whether to:
- declare 460p ofer final to encourage acceptances and attempt to blast it through,
- try and negotiate agreed price with Axis for them to recommend,(could be 500 to 550) or
- increase bid to around (I feel) 520, declare this offer final, which will encourage holders to sell in market or accept and attempt to sweep up by force.

Under the terms it has to announce any increased offer by next Mon, 26 Sept, so next few days crucial.

It has extended its existing offer to 10 Oct and certainly can't walk away now as some posters have suggested. Any increased offer can not be extended beyond this date.

I guess Alere will feel it has no more than 50% chance of succeeding at 460. After all the expenses it has incurred, rearanging all the bank debt etc, together with its 11% shareholding, I don't believe it will take this risk and feel it will pay up for greater chance of success.

There hasn't been great animosity between the two sides, unlike some bids, which makes me guess it will go for the second option to try and negotiate a recommendation with Axis as above.

All this could be upset if a counter bidder emerges, but although in theory such a bidder could wait until 3 Oct before emerging, this looks less likely now.

Hope above helps.

[tratante] 21/9/2011 16:49

I agree the current bid is obviously going to fail, but given that was so obvious from the first response date, why do Alere keep extending the deadline and buying more shares? Are they keeping the offer in play with a view to increasing it?

[jpjp100] 21/9/2011 13:29

I am watching for movement from First Eagle, it has built up a chunky CFD long in the time since the bid was announced at an average that I am gueestimating is over 470....

[markie5] 21/9/2011 13:24

whoever you are above, whilst your concerns for others potential loses are admirable maybe you should concentrate on a spread betting posistion if you are so sure of a fall of that size?

[markiie5] 21/9/2011 12:46

Well it took long enough for some of you to agree with me. I've been watching and laughing from the sidelines, as the share price falls, and the bid stalls.

You could EASILY have dumped at plus 500, instead of dancing to that old ASD tune of more jam and pie, if you only keep the faith and hold your shares.

Well now we are back to same ol same ol. As alftupper says, ASD are advancing a specious argument (and that is to put it politely) and you must have BLIND faith in ASD if you really believe in it's ability to deliver an share price of more than 460.

THE share price IS GONNA FALL. YOU KNOW IT IS.

So, get out now whilst you can at 460, else get out or stay in at 300.

Simple really.

[alftupper] 21/9/2011 12:22

I should have qualified my comment by saying that in the short-term ( next 12 months) both will be losers.

[jpjp100] 21/9/2011 11:16

alftupper is probably right that this bid isn't going to succeed

I don't agree that both companies will be losers if that is the case.

My view is that 460 is too low for now, the potential is there for ASD to be worth much more in a few years from now. A lot of holders have ridden this particular roller coaster for a long time now and their expectations are high. The share price could fall away considerably if this offer lapses, I don't doubt that.

I don't think Alere loses out either, it has a chance to sit back and potentially benefit from ASD's growth in the future, maybe bid again or sell out to another bidder later.

I don't think ASD will be an independant company 5 years (or less) from now.

My own view is that 560p would easily buy ASD today and still probably would in 18 / 24 months time.

[hotfinance14] 21/9/2011 11:15

Alf...why have the majority not agreed to the offer ?

[alftupper] 21/9/2011 11:02

This bid is not going to succeed - there will be no increased offer and both companies are losers. The multiple argument advanced by ASD is specious in my view and tells only half a story. The reality is that Alere are paying tomorrow's price today - the risk to holders of ASD is to the downside - you must have a huge believe in management being able to deliver.

[slaterlpj] 19/9/2011 17:45

Sold at 939 then. How many would you like sir? :)

[jpjp100] 19/9/2011 17:18

(460/2.4)*4.9 = 939 by my reckoning slaterpj

mmmmmm

[slaterlpj] 19/9/2011 15:07

"4.9x enterprise value to last twelve months revenue which compares to their Offer for Axis-Shield at 2.4x enterprise value"

Does this mean that the ASD board would suggest a bid approaching twice the current bid of 460p? 900+?

I'm all for that :)

[jpjp100] 19/9/2011 08:00

From today's ASD response...

- a pointer to where the next bid needs to be to have any chance?

- an invite to alternative bidders?

"As detailed in the circular we sent to you on 25 August 2011, the average of Alere's past comparable transactions is 4.9x enterprise value to last twelve months revenue which compares to their Offer for Axis-Shield at 2.4x enterprise value to last twelve months revenue.

Whilst we note that Alere has acquired approximately 5.5 million shares in Axis-Shield, we do not consider this to be an impediment to the smooth-running of the business nor a hindrance to any potential competing bid for the Company if one should arise. "

[hotfinance14] 16/9/2011 11:42

Great informative post.

[edgar3] 16/9/2011 11:25

Just seen this on another of the Boards - credit to Stuffee:

Alere's conduct is entirely predictable

Under the detailed conditions of the offer, Axis must publish its final defense information no later than Monday 19 Sept. This is the time targets nomally "put their best foot forward" to justify higher value etc. Alere would be unwise to declare any offer "final" until after this date. The latest date Alere can increase its offer is Mon 26 Sept. I would therefore expect Alere to make any improved offer next week between Mon 19 Sept and Mon 26 Sept.

Under the rules any offer by Alere must be accepted by 10 Oct; these dates would change if any other bidder pops up.

I still expect Alere will make a final offer at c 520p next week - weakness in markets over last 6 weeks might have dampened final values slightly. There still remains a chance another bidder will emerge and this could be expected any time after Axis' final defense info on 19 Sept but before 10 Oct.

[mutantpoodle] 16/9/2011 09:16

you're right wearing down by attrition
bored shareholders giving up and selling, though I would doubt the institutions would get bored,
probably still at lunch!

personally its better for me if Alere either take a long time...so its next tax year iro CGT
or better still come up with some loan notes deal

an increased offer in addition would be even better!

[jpjp100] 16/9/2011 09:06

Firs Eagle's long CFD position isn't getting any prettier just now

[9degrees] 16/9/2011 08:40

"Hold on" guys - dont let them get it for £4.60 by attrition.
They are hoping to wear us down into selling - dont do it!!

[hotfinance14] 16/9/2011 08:34

Surely ASD have to make an announcement after yesterdays 1pm deadline.

[hotfinance14] 16/9/2011 08:27

Advfn shows a 2million trade this morning.

[slaterlpj] 16/9/2011 08:24

How long are alere allowed to go on extending the offer?

Seems to be a bit of a farce, if each closing date is simply ignored, and then put back time after time. What a way to run a takeover.

I hope in the next waiting period, ASD have something to say, and more importantly to do about this. Else it will end up with Alere getting it for the 460 they want it for.

[jpjp100] 16/9/2011 08:06

Alere picked up another 1m shares in the extension period and extended again to 10 October

No increase in the offer

[tratante] 15/9/2011 17:32

all will be revealed tomorrow.