Chinese Takeover 69 cents, page-25

Excellent point henrietta

ROC hold approx $34 million in franking credits which are useless to Fosun. This could be paid out via a $79 million dividend.

ROC could pay 11.5 cents per share fully franked dividend so the offer price could be lowered to 57.5 cents and each holder effectively gets a 5 cent franking credit. This way all the franking credits are passed on to shareholders resulting in a more tax effective outcome and no change to Fosun's net purchase cost.

There must be a reason why this deal wasn't structured this way.

Cheers

Dan