ric, maybe the problem is that there would be more shares on offer with the granting of the options, so any suitor would have to pay more money out in the event of a takeover, making a takeover more expensive, so that means less likelihood of a takeover?
I was in a share once, and there was a capital raising for shares and options. Fortunately, immediately post capital-raising, we got a new shareholder, who bought shares above the CR price, and kept buying- up to close to 20%. We holders started talking about a potential takeover. Then, as luck would have it, the Directors decided they'd like some additional options, and more for the underwriters, too- let's all make hay while this sun shines! More for them in the event of a takeover! The new shareholder was not happy. The company withdrew some of the resolutions, but still voted themselves many freebies. The new shareholder made their vote clear, and voted no freebies, but the vote still got up. Then the share price got absolutely smashed, and now sits at half the raising price. This smashing happened immediately after the vote. I can;t help but think that if there was no essential desire from the Directors to give themselves more more MORE! that the company may have been taken over. Now it as to pay for those extra options in a takeover.
That anecdote may not be relevant here, but I can't help being reminded. I do note, though, that there was no real protest vote against the options for TXN. On the other hand, TXN does does have a very loose register, as opposed to my anecdotal tale, where a potential suitor said no.
Just some thoughts there.
TXN Price at posting:
39.5¢ Sentiment: None Disclosure: Not Held
