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M&A - stock basics
Posted on 12/5/12 at 9:56 am
Posted on 12/5/12 at 9:56 am
Ok, sorry if stupid question here but I was wondering how M&A's work when you own stock in a publicly traded company. For example, I owned PXP and hit a sell limit on announcement of FCX buying them. The article I read said that FCX is paying $25/sh plus a fraction of an FCX share per share to get the total of $50 per share to buy out PXP.
Does this mean that everyone has to sell? What if I didn't have a limit set and wanted to keep my PXP shares? can a majority vote make everyone sell at a certain price?
Does this mean that everyone has to sell? What if I didn't have a limit set and wanted to keep my PXP shares? can a majority vote make everyone sell at a certain price?
This post was edited on 12/5/12 at 9:57 am
3
Posted on 12/5/12 at 10:06 am to Crbello4Hiceman
quote:
What if I didn't have a limit set and wanted to keep my PXP shares?
There will be no such thing as a PXP share. The company will be a part of FCX.
quote:
can a majority vote make everyone sell at a certain price?
Yes.
Posted on 12/5/12 at 10:15 am to Crbello4Hiceman
quote:
can a majority vote make everyone sell at a certain price?
Do you mean sell the company or sell your shares?
You can keep your shares until the transaction is completed when your shares will convert to FCX at whatever ratio.
Posted on 12/5/12 at 10:22 am to Crbello4Hiceman
Congratulations on owning PXP prior to the announcement! 
Posted on 12/5/12 at 10:31 am to LSURussian
Thanks! It's like watching a horse race when you have a winner, isn't it? What a rush!
My boss in Houston called me and recommended I buy it after he saw the articles that they did their acquisition deal a couple months back. If I remember, they bought some BP or RIG space in the gulf, can't quite recall. Either way, the stock dropped significantly and he said he added it up and PXP made a good deal with the debt compared to production and that the street was panicking. I talked to him this morning after I sold and he admitted that he never dreamed that this would happen.
Edited to re-word to clarify that my boss and I are unaffiliated and had no non-public knowledge on this stock
My boss in Houston called me and recommended I buy it after he saw the articles that they did their acquisition deal a couple months back. If I remember, they bought some BP or RIG space in the gulf, can't quite recall. Either way, the stock dropped significantly and he said he added it up and PXP made a good deal with the debt compared to production and that the street was panicking. I talked to him this morning after I sold and he admitted that he never dreamed that this would happen.
Edited to re-word to clarify that my boss and I are unaffiliated and had no non-public knowledge on this stock
This post was edited on 12/5/12 at 10:47 am
Posted on 12/5/12 at 10:32 am to Crbello4Hiceman
quote:
they bought some BP or RIG space in the gulf, can't quite recall.
BP Assets for around $5B.
This post was edited on 12/5/12 at 10:33 am
Posted on 12/5/12 at 10:34 am to Crbello4Hiceman
quote:
My boss in Houston called me and recommended I buy it after they did their acquisition deal a couple months back.
You might not want to spread that info around too much depending on your boss' position at the company. It might be considered insider trading.*
Enjoy your profits! I'm officially envious of you.
ETA: *I'm assuming you and your boss work at PXP, which might not be a valid assumption.
This post was edited on 12/5/12 at 10:37 am
Posted on 12/5/12 at 10:39 am to LSURussian
Nope, we work for a privately held engineering company, haha- I should have clarified.
Posted on 12/5/12 at 10:41 am to Crbello4Hiceman
My bad. Posted on 12/5/12 at 11:11 am to Crbello4Hiceman
I did the same thing after the BP asset buys, I only wish I had more dry powder at the time. Needless to say I was excited to read your post.
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