What happens when a small listed ASX company which I own some shares gets taken over by a larger listed ASX company within the same industry of work?
What happens to my shares?
Listed ASX Company Gets Taken over
kingwang on 19/01/2016 - 19:20
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I think there is usually 3 options depending on what the directors have agreed to;
Full cash offer - so you will get paid for all your shares, then you will not have them anymore. It will be however many shares you own * offer price = payout.
Shares in the company taking over yours. - this is most common on those small mining company takeovers. Usually done on some ratio i.e. 3 of your shares for 1 of theirs.
Part cash part shares in the company taking over your company - this is a pain as there is usually the shares ratio and the payout ratio.
There will be more announcements on the ASX when the time comes, might even be a shareholder meeting to approve the takeover (and if you attend you get a free cuppa and a biscuit!)
You will get a bundle of thick booklets in the mail. The main one you want to read is headed the target statement. It will describe what is going on from your company's perspective.
You may have to make a choice like selecting cash or shares, but usually even if you do nothing you will get a reasonable outcome.
You are likely to have to pay CGT it the share price is higher than when you got the shares.
Pretty sure you either get bought out, or they consolidate them into the parent company.