South32 S32 Share Buy Back Yes/ No?

tunzafun001 on 18/09/2016 - 11:20

So S32 have offered to buy back share volumes under $500 value at the volume weighted average sale price throughout the October 10 sale (with no brokerage costs).

Should we sell?

I'm thinking under $500 equates to about $12 brokerage saving (or 5 cents per share discount,working on $500 worth of shares at a value of $2 each).

I assume the only reason the shares will sell on the day is if they are at a great price for a buyer, and will be much less than a 5c discount? So I'm thinking I'm better off retaining and weathering the initial drop on the day.

Perhaps a good day to increase your portfolio?

Thoughts?

Cheers all

Financial

Comments

  • [Deactivated] on 18/09/2016 - 11:54
    -2

    Ozbargain isn't really the place for professional financial advice
    I would say do what you feel is right or seek professional advice about the decision etc

    • fruit on 18/09/2016 - 14:02

      How else can you learn?

      • [Deactivated] on 18/09/2016 - 18:00
        +1

        By asking people qualified
        not the armchair experts at Ozbargain

        Neg away clowns, why risk finanical advice off people here
        only throwing money away with so called experts

  • poboy on 18/09/2016 - 16:01

    Do you want $500 now, or are you happy for it to stay invested. Before the offer you were happy, why change your mind now?

    • tunzafun001 on 18/09/2016 - 17:19

      Cheers, but looking for more incite into these type of offers. As it isn't a buy back, but a sale to market. I think I'll keep them as I cant really see a benefit of selling on a day of a flooded market.

  • barginseeker004 on 20/09/2016 - 20:51

    It is simply a matter of if you would like to sell or keep your S32. If you would like to sell its a easy way to get out with no brokerage. The on market sale is managed by the broker appointed by S32 so there won't be a flooded market, not to mention the average daily volume is 32 million shares (a lot of small parcels)

    • tunzafun001 on 20/09/2016 - 22:15

      But it assumes/ forces a sale if you don't respond. So there will definitely be an anomaly of extra sellers on the day. The free brokerage represents about 6c per share and I think they will drop more than that. So I'm going to hold. Thanks for the info though.

      • barginseeker004 on 20/09/2016 - 22:38

        Its not necessarily sold on the day, there is a long window for the broker to manage the sale

        • tunzafun001 on 21/09/2016 - 08:35

          I couldn't see a "window" in the paper work? I read it as the average price over the day? How long is the window?

        • barginseeker004 on 21/09/2016 - 12:43

          Not sure if they bother to release the window length, but it will be at the brokers discretion. They manage the sale so as not to move the market (although the 13.5 million eligible shares is well within the variation of a normal trading day's volume).

          See the FAQ that came with the letter/ASX announcement which includes the following:

          "The shares in the sale facility will be sold by the appointed broker on the ASX or another licensed market. The broker may sell the shares in one or more trades and on one or more trading days as determined by the broker in its discretion"

  • Euphemistic on 20/09/2016 - 21:15

    I looked at it and spdecided that selling was the simpler option given how much % wise it would cost for me to sell them. I did consider that the value might be a little lower on the sale date, but not really concerning. I'm not even sure how we ended up with them, certainly didn't buy them.

    • barginseeker004 on 20/09/2016 - 22:37

      S32 was spun out of BHP last year, so every BHP shareholder one S32 share for every BHP held

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