The Potential New Brazil Fast Food Company Buyout
A year and a half ago many bloggers. Hedge funds. Private investors. And I banded together to campaign against a horrible proposed buyout offer by Brazil Fast Food Companies (BOBS) controlling shareholders.
At the time I thought BOBS was worth a conservative $20 – $25 per share. So the offer by company insiders of $15.50 was ridiculous.
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We made enough noise. And got enough shares together that we were able to vote down the ridiculous low ball offer of $15.50 per share.
Well now there is another offer on the table. And several people have asked my thoughts on this new offer.
Queijo Holdings Offer To Buy Out Brazil Fast Food
In January I wrote my thoughts in this post – Sad To Be Losing Ownership of This Company That Gained 129% – about the offer.
I explained in that post that I expected the buyout offer to get approved. And to lose ownership of BOBS. But I didn’t explain why I thought this.
The Queijo Holdings offer of $18.30 per share for BOBS shares not owned by the controlling shareholders is still a low ball offer. In my opinion it is a certainty to get approved.
One reason is because BOBS insiders learned their lesson from the previous failed buyout offer.
A year and a half ago BOBS insiders didn’t presecure any non controlling shareholders votes on the proposed deal. This time they have.
The way I understand it… This vote requires a simple majority of non controlling shareholders to vote yes to approve the deal. And this time BOBS controlling shareholders have already gotten 40% of the non control voters to approve this deal.
In addition, two independent stockholder groups of the Company that approached the Controlling Stockholders, which collectively represent 40.55% of the shares of common stock held by minority stockholders, have agreed with the Controlling Stockholders to support a transaction only if the Board of Directors recommends one at the price set forth in the proposal.
This means that only 9.46% more non controlling shareholders need to vote yes to approve this deal. While I don’t know the results of the last vote. I will bet BOBS got more than 9.5% of non controlling shareholders to vote yes for the transaction to approve it.
The above quoted area is from this site.
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The above article also explains the other reasons why I am positive this transaction will get approved.
The article explains that a “special committee” must approve this deal before it can go through. But BOBS and Queijo Holdings are picking the “special committee.” So the special committees incentives are to approve the price. And approve the deal since BOBS and Queijo are paying their fees in this case.
And whoever pays the fees for something usually gets what they want.
The above reasons are why I am positive this deal will go through.
I hope I’m wrong because I don’t want to lose ownership of this company…
But these are the reasons I expect this deal to go ahead.
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