OTCQX:YZCAY - Post by User
Comment by
Grebmoolbon Aug 30, 2009 9:32am
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Post# 16262072
RE: RE: Yanzhou Coal in bid for Felix Resources
RE: RE: Yanzhou Coal in bid for Felix ResourcesThough acceptance of the offer by Yanzhou for Felix Resources by the company directors holding 47% of the companies shares and recommendation of the bid. It looks as if there will be a very large rejection of Yanzhou's offer.
Former directors and managers hold about 23% of the company and are looking for a much higher offer with the option of shares in the bidder for Felix Resources. Capital gains tax is a heavily riding factor that could well scupper the Yanzhou bid.
Favored bidder for Felix would be BHP Billiton who could offer a cash or stock option.
UK shareholders number about 10% of Felix Resources stockholders and though Australians pay no taxes on dividends (fully franked), UK holders are disadvantaged in being liable to tax on 70% of the payment.
There are difficulties in Yanzhou offering Yanzhou stock as an alternative in this bid. However, that looks to be the answer, even though Yanzhou directors are hesitating to take that route to success.