Last December 28, 2011, I made a post in our group page in facebook regarding my theory on PLDT tender offer
I mentioned that I expected PLDT shares to rise way above 2500 pesos so that on the tender offer period, dgtl shareholders will prefer to convert their holdings to tel shares for 2500 apiece than cash for 1.60 gross. The management will intentionally push the price up for it to happen because it will be more favorable to them to issue additional shares of TEL than to pay huge amount of cash that I estimated to be around 4.6 billion pesos. And I expected that when the final settlement is done, we can see tel shares to drop to its normal price level.
Here is my actual post
According to the news on Pldt last January 19 about the result of the tender offer, it mentioned that:
- Of the total shares tendered, 13% or 374 million Digitel shares are to be paid in cash, and 87% or 2,514 million Digitel shares are to be paid in PLDT common shares. This translates to the payment by PLDT of about P600 million in cash and issuance of approximately 1.6 million PLDT common shares.
The tendered shares are to be crossed in the Philippine Stock Exchange (PSE) on 24 January 2012 and settlement of both cash and share transactions will be on 27 January 2012.
On January 26, 2012, one day before the settlement date, TEL shares went down by 4.37% to 2652. After reaching 2886 last week, it is now trading to 2652 and expected to go down further.
I have here the broker information for tel on January 26 2012:
The top seller for that day is DEUTSCHE (broker 209) selling 260 million plus worth of TEL shares representing 26% of total volume traded for that day.
DEUSTCHE is MVP’s broker.
This January, we saw a strong bull market when the index reached new high and most of the stocks making strong upward movements. But part of that index movement is contributed by the increase in TEL. Now that they are dumping TEL shares, it will pull the index down with it. So by February, stock prices “may” go back to its normal level.
