Flex Posted August 4, 2016 Report Share Posted August 4, 2016 Shares of nutritional products business Vitaco Holdings Ltd (ASX: VIT) are flying higher today after the company entered into a Scheme Implementation Deed with a Chinese-based consortium to acquire 100% of its shares. The consortium members are Shanghai Pharma, a pharmaceutical group with a market capitalisation of $10.1 billion, and Primavera Capital, a leading Asia-based investment firm. The board of directors have put their full support behind the $313.7 million deal that values the company at $2.25 per share – a 27.8% premium from yesterday’s closing price. The deal is also a 7% premium from Vitaco’s September 2015 IPO price of $2.10. Vitaco’s chairman, Greg Richards said in the announcement: “The Scheme represents attractive upfront and certain value for shareholders, particularly given ongoing volatile macroeconomic conditions and regulatory uncertainty in China”. The deal has also received support from one of Vitaco’s biggest shareholders, Next Capital, who owns 15.3% of the shares. Vitaco also provided its preliminary financial results for FY16 that showed the company delivered revenue growth of 23.5% to $212.9 million. Earnings were in line with the prospectus forecast with pro forma NPAT and EPS of $13.1 million and 9.4 cents per share, respectively. While this was a solid performance, the deal is likely to get the support of other shareholders based on the somewhat subdued outlook for FY17 provided by management. Vitaco stated that it expects only modest earnings growth in FY17 “due to additional business investment required to support longer-term growth, the impact from the loss of the Trilogy contract and continued regulatory uncertainty in China”. Vitaco has committed to increasing its operating costs by increasing its marketing spend and staff numbers in an attempt to gain further penetration into the Chinese market. There is also the potential for higher capital expenditure with the company looking to expand its manufacturing and warehousing footprint in Auckland. Judging by the reaction of investors to other companies operating in the Chinese consumer sector like Blackmores Limited (ASX: BKL) and Bellamy’s Australia Ltd (ASX: BAL), today’s announcement has highlighted the point that there may be further takeover offers down the road from Chinese based consortiums. Shares of Blackmores and Bellamy’s have surged 3.5% and 5.1%, respectively, although investors should note that these two companies are much larger and trade at significantly higher valuations than that of Vitaco. Nevertheless, today’s announcement highlights the point that Australian-based products remain in high demand from Asian consumers and that this is likely to remain a growth story. Quote Link to comment Share on other sites More sharing options...
PETN Posted August 4, 2016 Report Share Posted August 4, 2016 Intredasting. I recently bought $70k ASX listed company shares. Worth $65.5k now like 2 weeks later lol. Would have been nice if you'd said 18 months ago to buy blackmores shares. A bit late to the party now I think. I guess it's good news for the vitaco share holders. I'd probably sell now immediately if I held though and buy KDR. Quote Link to comment Share on other sites More sharing options...
Flex Posted August 4, 2016 Author Report Share Posted August 4, 2016 Not good luck for a lot of public shareholders that bought above $2.25 - it listed in September at $2 and got as high as $3.23, it's only been below $2.25 since around Feb this year when it dropped down to $1.40 and languished between $1.50and $2.00 for the last few months. Quote Link to comment Share on other sites More sharing options...
PETN Posted August 5, 2016 Report Share Posted August 5, 2016 You a holder? Quote Link to comment Share on other sites More sharing options...
GyzzBrah Posted August 6, 2016 Report Share Posted August 6, 2016 What the f*ck am I studying in uni for if people can already buy shares without a financial manager. Quote Link to comment Share on other sites More sharing options...
PETN Posted August 6, 2016 Report Share Posted August 6, 2016 Because lots of people can't be fucked or don't have the time to be doing their own research then trading/watching their shares. I'm down like 4k now but have learned quite a bit since I started less than a month ago. Reckon by the end of this week I'll be only down max of 2k - breaking even. That's just my guess based on past few days though...could lose more too if something changes in the market or one of my larger holdings makes a shit announcement. I enjoy it. It's better than casino imo. More fun and better return and ASX trading time is open during my work hours so I'm getting paid anyway too. perform.nz 1 Quote Link to comment Share on other sites More sharing options...
Terrymundo Posted August 12, 2016 Report Share Posted August 12, 2016 I've been a longtime forex trader and would should suggest it good place for people to get their feet wet. Markets are more liquid and more predictable to me. Tighter spreads from brokers too so its cool to see your trade go green instantly. If you got the time and money it good fun and pit's few bucks in your too. I emphasis "trading" not investing. Remember it's investors that pay the traders ? Quote Link to comment Share on other sites More sharing options...
PETN Posted August 12, 2016 Report Share Posted August 12, 2016 Yeah well I lost 8.5k market value over last 2 days. Feels similar to chasing casino losses atm. Hopefully it goes up again lol. At end of the day though doesn't really matter of I lose whole 75k. Can easily make more money. Would fucking hurt still though. Can't really trade anymore as getting sent out to where there's nothing but satellite internet for work and f*ck paying for that. Plus probably wouldn't get away with it there either. Quote Link to comment Share on other sites More sharing options...
Terrymundo Posted August 12, 2016 Report Share Posted August 12, 2016 The easier it goes down the easier it can go up! Not going to hedge? jimmybro1 1 Quote Link to comment Share on other sites More sharing options...
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