The dividend effect will pull share swap ratio down significantly!

Special Situations, Content Strategist, Smartkarma

Crispin Francis

Special Situations, Content Strategist

Smartkarma

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On 13 August 2015, Yuanta Financial Holding ("2885 TT") announced that it would be acquiring Ta Chong Bank ("2847" TT) for TWD 16.3 / share.<ul><li>The deal is valued at ~ USD 1.5 Bn.&nbsp;</li><li>&nbsp;50% Cash / 50% Scrip</li><li>The share swap ratio is adjusted such that the implied offer for the scrip component is equivalent to TWD 8.15/share. The 'share price' of Yuanta is calculated from the average of 20/40/60 trading days.</li></ul>The ratio according to the presentation is given to be 0.46, however, the implied ratio in the announcement is calculated to be 0.528 (using price of Yuanta common share given in the announcement,&nbsp;NT$15.4310 per share).To clarify things, we spoke to TC Bank. Extracts from the conversation can be found further down in this piece.The entire sector has been falling.&nbsp;Ta Chong Bank, however, has done the opposite... more below the fold...

On 13 August 2015, Yuanta Financial Holding ("2885 TT") announced that it would be acquiring Ta Chong Bank ("2847" TT) for TWD 16.3 / share.The deal is valued at ~ USD 1.5 Bn.&nbsp;&nbsp;50% Cash / 50% ScripThe share swap ratio is adjusted such that the implied offer for the scrip component is equivalent to TWD 8.15/share. The 'share price' of Yuanta is calculated from the average of 20/40/60 trading days.The ratio according to the presentation is given to be 0.46, however, the implied ratio in the announcement is calculated to be 0.528 (using price of Yuanta common share given in the announcement,&nbsp;NT$15.4310 per share).To clarify things, we spoke to TC Bank. Extracts from the conversation can be found further down in this piece.The entire sector has been falling.&nbsp;Ta Chong Bank, however, has done the opposite... more below the fold...

Ta Chong Bank

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