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Re: Re: [sharechat] DAD made a takeover offer for BCH

From:	"Peter" <pmaiden@xtra.co.nz>
Date:	Thu, 26 Jul 2001 08:01:15 +1200

Gerry -interesting times ahead.

I can see why Baycorp are not too enthusiastic about this 'offer'. There isn't any premium in it for BCH shareholders and as you say the calculations have been done on a rising DAD price and a declining BCH price.

Also it seems the valuation is structured around future earnings (pre amortisation) projections. No problem in that except to comment that DAD earnings streams have been a bit up and down over the last year or so while BCH has shown a great degree of reliability.

I see that the The Age says ".... the merger is initially expected to be slightly earnings per share dilutive for Data Advantage."

My view is that using pre-amortisation forecasts seem to favour DAD as they have a greater amount of goodwill in their balance sheet. I note that they have valued their database at around $140M on their balnace sheet.

Let's see what pans out

Cheers

Peter

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