Some points that I have pondered since the announcement yesterday as an observer only (in an unaffected or preconceived fashion- and I stand to be corrected on any of them):
Ex the Toll announcement to the Market-
Link here:
TOLL ASX Announcement.14.07.08
The Share Distribution Date is 22 August 08 - so I assume that is the date of effective title transfer and that they become "Trade-able" as at 10:00 AEST on the opening of the market?????
Ex: The Courier Mail article today-
Link here:
15.07.08 Toll Holdings to offload nearly all its Virgin shares | The Courier-Mail
The Toll holding is 62.7% or 648,000,000 shares (acquired as part of the Patrick takeover) of which they are going to retain 1.7% or 11,000,000 shares as a strategic holding, leaving some 637,000,000 shares (61% distributed to Toll shareholders 1 for 1 as a "Dividend") to be effectively pumped into the current market at 10:00 AEST on Friday the 22nd of August.
(all figures above ex CM article- I haven't done the research)
Not that I'm not saying that there is not someone out there preparing to do a strategic snatch and grab on the stock/airline- or players currently assembling a position (post the announcement) in the lead up to this distribution.
Given the demographic of the current shareholders of Toll receiving this "Dividend"- which will include Institutions, Professional/Experienced traders and Broking Houses.
What is the capacity/appetite of the market in these current times to absorb that volume of an aviation stock, and what net effect will that have on the price?????
Or what will the commitment/fortitude of these new stockholders be to ride out the current Aviation Cycle???????
For Toll having had a "professional adviser" work on disposing of their holding for some time- they have paid a dividend in the form of an airline to their current holders- would they not just book the difference between the holding value in the books and the dividend as a book loss going forward????, and get on with life.