Current price: $156
Tender Price: $144 – $162
Upside: 4% or $600 (if priced at the upper limit)
Expiration Date: 15 of August, 2019
Very similar situation to DaVita from transactional perspective.
ADS ($8bn market cap) announced dutch tender with odd-lot provision to repurchase 9%-10% of the company at $144-$162/share. Currently ADS trades in the upper part of the tender range. Management owns 2.3% of the stock and will not tender. The company will have another $0.35bn remaining under buyback authorization after the current offer expires.
The offer was announced simultaneously with Q2 results which were somewhat below expectations but included improved EPS guidance driven by partial-year benefit of anticipated share repurchases (including current tender) and cost reductions. Revenue guidance was unchanged.
Pre-announcement price stands at $150/share.
As with DaVita, I have no opinion on the likelihood of upper limit pricing on this one.