UCS mispriced or me missing the plot

[SimonPB]

UCS arbritrage in the offering ?? http://ow.ly/3D5GH

[THRESHOLD]

Even at R240 you get should get nearly that back as a dividend - by way of BCX shares + the small cash dividend due next month. So - once you receive this - you sell your UCS share at a whopping loss for tax and pocket another windfall in tax benefits. Then take back your UCS's for next to nothing and benefit from their new symbiotic relationship with one of the biggest local IT players.

[THRESHOLD]

R 2.40

[#4]

When this transaction is finalized, a current holder of UCS will be alloted BCX share and they keep their UCS shares, correct?

[#5]

did you take the BCX share dilution into account? 100m BCX shares will result in about a 30% dilution, I think , so the price equivalent of the BCX shares is probably around 510-550 million.

[THRESHOLD]

Actually there should be an anti-dilutive effect as the UCS assets should prove earnings / value accretive. The additional liquidity should put BCX under pressure for a while following the deal (and more specifically the distribution as a dividend in specie) So if one were to follow this trade, it would be good practice to go short BCX until this clears.