Joined Oct 2017
L6: Expert
Forum Thread
Question about a merge election offer
September 5, 2023 at
12:07 PM
Thread Details
I was given an election offer for my shares in VMW.
Here is an article for it:
https://investorplace.c
"On paper, shareholders can choose either cash ($142.50) or 0.252 shares of AVGO for each of their shares of VMW stock.
However, given the proration terms of the transaction agreement, in practice (when exchanging their shares), investors will receive 50% of the cash option, and 50% of the share exchange option. Hence, the aforementioned estimated share price."
I don't understand this. The current stock price of AVGO is $875, it is significantly above the share price of 0.252 share of VMW. And $142.50 is significantly below the current market value of VMW. What is the catch? Will the share price of AVGO drop as more share holders elect to exchange share?
Here is an article for it:
https://investorplace.c
"On paper, shareholders can choose either cash ($142.50) or 0.252 shares of AVGO for each of their shares of VMW stock.
However, given the proration terms of the transaction agreement, in practice (when exchanging their shares), investors will receive 50% of the cash option, and 50% of the share exchange option. Hence, the aforementioned estimated share price."
I don't understand this. The current stock price of AVGO is $875, it is significantly above the share price of 0.252 share of VMW. And $142.50 is significantly below the current market value of VMW. What is the catch? Will the share price of AVGO drop as more share holders elect to exchange share?
About the OP
2 Comments
Your comment cannot be blank.
Sign up for a Slickdeals account to remove this ad.