Canaccord Genuity Group (CF.TO) – Odd Lot Tender Offer – C$80 Upside

Current price: C$14.68

Offer price: C$15.50 – C$16.50

Upside: C$80 (for odd lots at the lower limit)

Expiration: 27th of January 2022

Press release

 

A short note on yet another Canadian odd lot tender offer.

Canaccord Genuity Group announced a substantial issuer bid for 6% of its diluted shares at C$15.50 – C$16.50/share. The offer will commence on the 22nd of December and will expire on the 27th of January. So far, the details are limited as the circular hasn’t been released yet (should be out shortly). The current press release did not specificly outline whether the offer will include an odd-lot provision, however, it’s very likely that it will. The company has done a substantial issuer bid before, in 2019, and the initial press release then has been pretty much identical to the current one (also didn’t mention odd lots).  However, upon release of a full circular, it turned out that odd-lots were getting accepted on a priority basis. In 2019 paid-up capital stood at C$6.87/share and shouldn’t have changed much since then. So the situation offers C$80 – C$160 profit for odd-lot positions on trading accounts that are not subject to withholding taxes (e.g. Canadian residents/US IRA). Tendering with larger positions is risky as the tender size is quite small. Directors won’t participate (own around 8%). There are no major shareholders (10% or more).

Canaccord Genuity Group is a Canadian investment banking and financial services provider. The company has been a strong beneficiary of post-COVID economic recovery. Currently trades at 1.2x BV.

7 COMMENTS

    1. simcha123

      They should not be, but may depend on the broker. Others here have reported that IB and Vanguard do not withhold from IRA

      1
  1. Terence

    Preliminary results out, oversubscribed at C$15.50, as expected since it has been trading a little below this minimum tender price. Total shares tendered = 2x shares accepted, including odd lots. Other than odd lots, bigger tenders were 82% accepted. (I don’t quite understand the math here, 2x oversubscribed, even more oversubscribed if we exclude odd lots, and the shares accepted is that high?)
    https://finance.yahoo.com/news/canaccord-genuity-group-inc-announces-122900552.html

  2. ka_yoyo

    Hi! How is withholding tax involved here? Is there some kind of dividend involved?

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