BAW SSF contracts??PPC??

[tsbc]

How does the unbundling of PPC from BAW effect SSF holders of BAW? are we entitled to PPC share or will there just be an adjustment to the SSF price of BAW? What can we expect?

[CAB]

Interesting article in Fin Week by Trader Vic who holds BAWSTA. He reckons Std Bank will be making some adjustments, if not the holders of the share instalment will profit handsomely. Worth reading if you're interested in BAW or PPC.

[barry_1]

See my comments under BAW on this very subject as well.

[tsbc]

I read the article and your post, but still interested to find out if SSF holders are entitled to any benifits of the unbundling, and how in PPC shares or cash adjustment?

[SimonPB]

in truth nobody knows how the adjustment will be done (not event the SB instalment guys). Issues and SSF's market makers will take guidiance from SAFEX, either you get PPC shares/ssf's/instalments/warrants or teh terms get adjusted to remove the PPC unbundling effect. Either way holders will not be negatively affected as adjustments will be made accordinly.

[#6]

does that include holders of EDS (enhanced div securities ? Jaye

[JohnnyCash]

It may look complicated initially but it is in fact not. Its the value of the unbundling that makes them nervous. Any instalment/ enhanced divi product states that all and any payouts flows through to the holder cause the issuer holds the underlying. So it should not be a problem merely distributing the PPC-shares, same as any special dividend. May have a slight problem with subsequent pricing of the instalment, but BAW should run up enough for that calc to do. It may just look strange for instance on BAWSTA that you'll pay R1 for it with a final payment of R107, if BAW is trading ex-div at around R108, but that is how the price is calculated at the moment (barring small adjustment for interest.

Simon, a suggestion, SBK can keep the PPC shares and change terms of the instalments to cover both shares in a combo and at expiry can decide if you want to realise. If not new issue can be 2 seperate issues over the 2 shares and voila! Then the combined price should still be around R200 and you just keep track of the combined movement at the appropriate ratio.

[SimonPB]

JCash, yes we could, tis called a basket. As mentioned we will take guidence from SAFEX.