Investor warning on low ball offer

Monday 15th November 2010 2 Comments

Both the Securities Commission and Perpetual Trust have warned investors to seek independent financial advice before making a decision to accept Stock and Share's latest five cents offer for their debenture investments in Strategic Finance (in receivership and liquidation).

"The receivers recently provided a report to investors advising that their current estimate of recoveries from Strategic's assets is gross returns to Strategic's debenture holders of between 12 and 35 cents of the amount that is owed them," said Perpetual Corporate Trust head Matthew Lancaster.

"While Stock and Share's offer may hold some appeal to investors who are seeking funds prior to Christmas, we remain confident that a much better payment is coming their way. We also continue to caution anyone considering this bid to carefully check that the terms of Stock and Share's offer guarantee immediate payment."

The Securities Commission has previously warned investors about unsolicited offers of this nature. On its website the Commission says that although such unsolicited offers are not illegal, even when offering prices below market value, it is against the law to mislead or deceive investors into accepting an offer.

Comments from our readers

On 15 November 2010 at 5:49 pm peter said:

Not much use relying on any information coming from these parties.

On 16 November 2010 at 10:53 am Tony Ryburn said:

Agree no point in relying on information from these parties. Of course if the Receiver and Perpetual were prepared to guarantee that the minimum payout would be not less than 12 cents that would be a different story. It must be frustrating as a debenture holder to be in the hands of those who have 'all care and no responsibility'.