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Online Share Trading

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Simmers Vs Village Main

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Mr_Money
Regular Contributor
Which of the two should I buy Simmers or Village main before the merger ?
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6 REPLIES 6
Fredsed
Super Contributor
Price action indicates disdain about something. Its as though a nefarious stripping out of shareholder value is being assumed. SIM has more liquidity. At what price will this market change its mind?
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buyme
Contributor
it depends on whether your trading it short term or long term.at the current village share price and conversion ratio of 47.72 ,you will receive 88.75cents per simmer share instead of the 105 cents.when the village shares start trading i think a lot of guys are going to try and liquidate their positions and at current bids no one seems too eager to buy,so you will probably have to exit at a lower price than now.so short term maybe buy simmers and hope you can exit at a decent price. long term ,with the fact that a lot of guys might be trying to exit their positions after the conversion,you might pick up village at a low price. just i thought,i was going to trade it but cancelled my bid,because it might not be worth it.
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PaulC
Super Contributor
Uncertainty = Risk. Id go and buy and company that is actually making money. Just a though. If you wanna gamble try UUU or FUM (I think thats the symbol) :) - P
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Jechlojoes
Contributor
In my opinion 105 cents is the intrinsic value for Simmers shareholders at time of announcement. This is still relevant irrespective of Village price movement. It represents a premium of about 12% at previous levels of 93/94 cents and about 43 % at current price. Or am I mistaken?
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Mr_Money
Regular Contributor
Thanks for the good advice guys (Buyme/Fred and Jech), much appreciated. @Paul , I am a long term investor and have invested in solid comapanies like Naspers , MTN , Exx , Sasol , Vodacom , PSG , CPI and JSE. I do however keep 10% of my portolio in small resource stocks like MTX , GBG , MMH and MRF where I take more risks. I was looking at exiting MTX at some stage (waiting for clarity on the cautionary) and hoping to get some Village and look at holding Village for two years.
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THRESHOLD
Super Contributor
BOTH ARE TECHNICALLY ON THE EDGE OF INSOLVENCY. THEY ARE FEEDING OFF EQUITY RAISING EFFORTS - THEY NEVER GENERATE FREE CASH FLOW AND SIMMERS ORE BODIES ARE BECOMING MORE AND MORE COMPLEX (READ COSTLY) TO EXPLOIT. GIVEN A CHOICE BETWEEN THE TWO - I WOULD PICK BILLITON.
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