Thomson Reuters (TRI) – Tender Offer – 5% Upside

Current Price – $44.6

Tender Price – $42.0 – $47.0

Upside – 5.5% (if priced at the upper limit)

Expiration Date – October 2nd, 2018

SEC Filling

 

Thomson Reuters announced $9bn buyback, equivalent to 30% of outstanding shares. Although the offer is large, controlling shareholder Woodbridge (64% owner) will also make a proportionate tender, meaning that 2/3 of the tender amount is already reserved for Woodbridge. Tender price will be determined by the remaining minority shareholders.

Tender offer is conditioned and will be funded by proceeds from the sale of Financial & Risk business to Blackstone, that is expected to close one day before the expiration of the offer.

I have no arguments neither in favor for lower nor upper limits and would expect the tender to be priced around current market prices (or price at the time of tender expiration).

There is odd-lot priority for holders of 99 shares or less.

11 COMMENTS

  1. Alex15

    Looks like it’s priced very efficiently. I think tendering at 44 is a good way to play this.

  2. makarid

    So, if we assume that 2/3 of the offer are reserved for the Woodbridge, in order of the offer to be oversubscribed, at least 10% of the remaining 36% must tender their shares.

    1. nuggy5

      They will tender the same % of non-Woodbridge shares that tender so their ownership % remains the same.

  3. Alex15

    Has anybody been able to tender the shares? IB doesn’t show this as a corporate action.

    1. YVRtrader

      I sent IB a ticket and they added it. They often need a reminder, but respond quickly.

  4. nuggy5

    Only 20% of shareholders submitted shares for tender. Plus Woodbridge’s proportional tender that put the total tender below the $9bn TRI was going to purchase and thus they are buying all tendered shares at $47. I would have assumed a higher participation rate.

  5. marathontrading

    This just hit my account and they are withholding 15% in taxes!
    Will I get this back against my US taxes, or is it basically a 15% loss. Does anybody have experience with this?

  6. suresh99

    I got hit for 25% with fidelity. I need to call them. But i believe you can get it back during tax time since your selling price will be lower than your cost basis. At least i hope that’s the case

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