KOREA: KT&G rejects Icahn's takeover bid.
Article in IHT
Icahn's $10 billion bid ($2 billion put up and $8 billion financed) was rejected by KTG board yesterday.
Shares are trading below the 60,000 won offer price, as the market does not see the prospects for a succesful buy-out imminent.
The 10 billion bid prices the company at 9.7 trillion won. Credit Suisse's Feb. 7 sum-of the parts figure puts the company at 10.6 trillion.
This gives Icahn about a $940 million buffer to work with if he decides to go hostile, giving share price an upwards cap of about 65,567 Won.
My money says no, for various reasons, chief of which are government would step in on the back of public denouncement (tobacco garners a lot of nationalistic sentiment in Korea).
Oh, how I wish I was in Korea during the hey days of value buying. Having visited Korea, and written my thesis on Korea and it's 3 East Asian Counterparts (Taiwan, Hong Kong, Singapore), I am a staunch advocate of strong fundamental Korean economic growth (Hyundai, Posco, Samsung, AmorePacific have all traded through my long-bias portfolio).
Icahn's $10 billion bid ($2 billion put up and $8 billion financed) was rejected by KTG board yesterday.
Shares are trading below the 60,000 won offer price, as the market does not see the prospects for a succesful buy-out imminent.
The 10 billion bid prices the company at 9.7 trillion won. Credit Suisse's Feb. 7 sum-of the parts figure puts the company at 10.6 trillion.
This gives Icahn about a $940 million buffer to work with if he decides to go hostile, giving share price an upwards cap of about 65,567 Won.
My money says no, for various reasons, chief of which are government would step in on the back of public denouncement (tobacco garners a lot of nationalistic sentiment in Korea).
Oh, how I wish I was in Korea during the hey days of value buying. Having visited Korea, and written my thesis on Korea and it's 3 East Asian Counterparts (Taiwan, Hong Kong, Singapore), I am a staunch advocate of strong fundamental Korean economic growth (Hyundai, Posco, Samsung, AmorePacific have all traded through my long-bias portfolio).
posted by howa at
2/28/2006
