independent expert report a joke

Based on today's announcement, I have no idea why independent experts get paid at all.

"The explanatory booklet will also contain an independent expert's report by DMR Corporate Pty Ltd.
The independent expert has concluded that, in the absence of a superior proposal, the Aegis
Acquisition Proposal is not fair however it is in the best interests of UCMS shareholders."

They got the first part right ------ the Aegis Acquisition proposal is not fair. However, they went on to say that even though it is not fair, it is in the best interest of UCMS shareholders? It will only be in the interest of selected parties of UCMS shareholders who are requiring the cash. It is definitely not in the interest of rational shareholders who are selling out a company dirt cheap.

My initial hunch on 18-05-09 was right. Aegis is buying into UCMS dirt cheap. However, UCMS is an illiquid stock, hence management has decided to cash in.

Oh boy, how can UCMS management tie themselves down to a clause that does not allow them to solicit rival bids. How dumb is that? Management of UCMS!! Your company is cheap and even with the premium Aegis is paying, it is still cheap. Please for goodness sake get some tension into the bidding process. This is the greatest rip off for retail shareholders, seeing a company with strong cashflows and balance sheets sold off cheaply. (Have a look at my earlier post last month)

Interested to see what the independent expert valuation is. I hope it comes out around $1.50.




On the 18-05-09, I wrote......

The following exerpt from Dow jones:

"The company, which earned about half-a-billion dollars in revenue in the year ended
March 31, expects to add about A$156 million in annual revenue after the completion of
the UCMS acquisition, Sengupta said. He declined to elaborate on the company's exact
revenue and profit after tax."

If UCMS is providing A$156million p.a. in revenue to Aegis BPO, it looks cheap.

In the past, net profit margin was around 8%. Assuming that drops to 5% post the Telstra contract loss, that will still equate to NPAT of $7.8mil.

If I remember correctly, UCMS has negligible debt levels, so Aegis BPO is really taking over UCMS on a P/E of 6.9x?

There must be more to it than meets the eye. Or else the board will not be tendering their entire shareholdings into the offer.

intrigued by the deal. Would want to see what the independent report comes up with. (They'll probably state it is worth $0.90 to $1.10). Lol. Anyway, watching announcements with interest.