BlairWitch749
Banned
It is hard finding data via google. when would the offer be made? i have a range of 6-9% interest rates for 1987; does anyone know Ford's market cap? Also, Bain has how much $ to play with? expect they want 15-20% returns/year off the top of my head. Any other info for a scenario?
The historical float in 1987 was ~55 million shares between 8-9 dollars a share
i would figure Bain buying up the float to enact a hostile take over would lead to the stock going to 11-12... they would have to do it very rapidly in order to prevent the ford family and the existing board from doing secondary offerings to try and dilute them from taking over... so a 50% premium money bomb is probably required and 12 dollars a share at 55 million shares is a 600 million market cap meaning romney would have to come up with 300 million and 12 dollars to gain voting control of the company
Bain had 50ish million on hand in the start of 1987 and raised another 107 million during the year.... could they raise another 150 million, I think yes if Romney named Ford as a target to his investors however he would have to suppress all rumors whilst doing it, because rumors would lead to the following
1. run up in the stock price making it harder for bain to buy it out
2. panic secondary offerings by the ford board and family to try and prevent bain from enacting the hostile takeover
Romney could alternatively buy 25-30 percent of the float with his cash on hand and then try to secure allies amongst large shareholders to have him named ceo and bain partners named to the board as a track to improving stock price and unlocking value... this could probably be done as the ford family and existing board were not popular at this time to the financial fuck ups of the previous decade... however this would require romney to work "within the system" and limits the amount of sweeping change he could make to the company
the former where Bain conducts the hostile take over then takes the company private would allow Romney to make whole sale operational changes whilst being able to ignore or squash all opposition