I see there is still a few people who keep a eye on the ol' RDF but no one comments. I still held on to a tiny holding.
Was just looking at the updated substantial shareholder notice and wondering what is going on in the register now?
To think there was possibly a $3.50 than a real $2.70 bids rejected and now at suc ha low price there is accumulation
Article from may 5 2011
http://www.smh.com.au/business/former-redflex-boss-casts-doubt-on-deal-20110504-1e8jx.html Former Redflex boss casts doubt on deal
Date May 5, 2011
Ian McIlwraith
The offer of $275 million made by the Macquarie Group and the Carlyle Group for the traffic camera group Redflex Holdings may be about to come to a screaming halt - otherwise known as ''an inflection point'' - thanks to a push for a different deal understood to be headed by the group's ousted chairman, Chris Cooper.
The Cooper camp is believed to be calling for the bidders to drop the link between their offer price and the Australia-US dollar exchange rate and to lift the cash bid above the nominal $2.70 to which it is pegged.
The opposition represents a real threat to the agreed acquisition of Redflex by Macquarie and Carlyle Group - scheduled to go to a shareholder vote in Melbourne on Monday morning - because the numbers are finely balanced. Showgirls Bar 20 . . . lost its licence.
Showgirls Bar 20 . . . lost its licence. Photo: Ken Irwin
The bidders already speak for 12 per cent of the shareholding and cannot vote at the meeting. That leaves them needing a supporting vote from three-quarters of non-associated shareholders.
Published statistics have shown that votes are lodged for barely
60 per cent of all shares in such circumstances and vastly fewer shareholders by number.
On that basis, the Redflex deal could be toppled by shareholders owning as little as 15 per cent to 18 per cent of the company.
The Redflex annual report last year showed Coper's wife, Elizabeth, held more than 11 per cent of Redflex. Ms Cheng Man Oy and the Ho family's Investaco - the recipients of a controversial placement that formed the basis of one of the arguments for Cooper's removal as chairman - held 5.6 per cent and 5.4 per cent respectively.
If either of these groups joined with the Coopers to vote against the scheme, they could sink the Macquarie/Carlyle acquisition strategy.
Those inside the Redflex tent declined to discuss even the existence of a renegade movement but Insider hears that Macquarie workers were beavering away last night on how to respond to the specific demands.
Clearly there is still daylight between the price being offered by Macquarie/Carlyle and what the consortium believes it can extract from owning Redflex. The question is how much of that upside they are prepared to give away to nail the deal - and whether they need the deal that badly at all.
Insider has pointed out that the $2.70 cash bid is, at face value, significantly lower than a mooted offer of $3.50 a share in late 2008 that never evolved into a public takeover.
Redflex has countered that because its business is heavily dependent on expansion and income in the United States, its value is inextricably linked to that currency.
That is why the existing bid sits at $2.70 only while the Australian dollar is worth between US$0.98 and US$1.02. The sliding scale calculation in the scheme booklet sent to shareholders in April cut out at an exchange rate of $US1.06.
At yesterday's exchange rate of $US1.085 to the Aussie, the cash-in-hand value of the bid would fall to about $2.54 a share - something the market has taken into account in dropping the Redflex share price from between $2.55 and $2.60 to a close of $2.49 yesterday.
The risk of pressing the bidders is that if they decide it is all too hard and allow their offer to be voted down, Redflex shares will revert to price levels of this time last year, before Macquarie showed its hand - about $1.80 a share. And they could possibly be made worse by the Macquarie/Carlyle 12 per cent stake overhanging the market.
RDF Price at posting:
88.0¢ Sentiment: None Disclosure: Held
