Western Wind Energy Corp V.WND

Market

[boutros]

I have been reading the western wind blog since the takeover bid announcenment. While I find some of the postings informational, the rest of the posts are based on sentiment rather than on facts. Unless you are an insider the facts are only available through the official WND news releases. Based on the official communication by WND the facts can be summarized in few sentences:

• There is a hostile takeover bid of 2.60 cash per share by BEP that expires today at 5.pm
• WND officially recommends to reject this offer on an undervalued basis
• WND is in a formal sales process that will result in a sale projected to be higher than 2.60
• There is no forecast end date for the end of the sales process
• There are other assets that will materliaze such as the Yabucoa closure that will add to the company's value

Based on the above facts it is recommended to not tender your shares. The recommendation is not without any risks, like any other investment. But in this case the risk reward factor seems to be low for the simple reason of " WND has material assets that all the players agree to be of a value of 2.50 or higher per share". So there is no real gain in tendering besides the "thought" of having materialzed your gain quicker. But this is not even a guarantee as tendering will only materialize when the majority of shareholders tender which is very unlikely to happen very soon. So tendering might have the opposite effect of delaying the whole process for everyone and the desire for quick money will instead prolong the process and harm all the shareholders including the ones who tendered. 

The share price of 2.38 supports the above theory. The market sentiment is the BEP bid will fail or at best will result in delays to the whole sales process. So if you tendered do not be very excited about getting your 2.60 soon even if 50% of the shareholders decided to do so. 

As a shareholder waiting on the sideline until all the cards are on the table is my best option at the moment.

[bakken13]

Good post boutros. To sum up, this has turned into another friggin mess, leaving shareholders waiting, again.

[modgil]

"So if you tendered do not be very excited about getting your 2.60 soon even if 50% of the shareholders decided to do so." If you tendered and the bid is successful, you will get your $2.60 fairly quickly. I can say that I am not too excited about the $2.60 that I get paid (I was hoping for better) but I do not see why there will be any delay if the bid is successful.