COS TOCould someone explain this:
“The price [Suncor/Imperial] would have to pay to get [Canadian Oil Sands] from the public would be a big premium,” Lever told BNN via email. “The arbs [arbitrage firms] would get involved and would want to ‘extract’ a huge premium.”
How do the Arbs get in. Do they have to own the shares before hand?
On a related but slightly different tactical item, think about this scenario.
Pres SU, IMO, COS meet for lunch and drinks.
Pres IMO: We want to buy you out. How does $16 sound.
Pres COS: BOD and Shareholder want $20.
Pres IMO: No Way. We will make unfriendly shr off at $16.
Lunch breaks up and we now have an unfirendly three running Syncrude.
Offer comes and Arbs get in and drive price to $20, IMO and SU back away and drop offer.
How do these guys get along after that knowing there is a knife at your back trying to stab you? Maybe then XOM doesn't supply best surfaces.
This is a tricky situation. I think that SU and IMO had better leverage when SCO was $55 and COS was in the $7 range because COS was losing money. Today SCO is fetching $Cdn74 and COS is will be cash positive once the Coker 8-3 turnover is completed.
JMHO
Namsoc