Cambria Automobiles is our auto-dealership that is being taken out by the management.

If you’d like to know more about it, you can find the previous write-ups here.

The first thing that I want to mention is my dislike for these situations. 

The text on these documents is all about deceiving the little guy, bringing very little clarity to anyone reading them.

It can take hours just to find a small piece of information. 

And even when you find it, it’s not always clear what it means – lawyers being lawyers.

But it is what it is so let’s proceed.

THE DETAILS

On the 30th of July, Mark Lavery, the CEO, came up with a revised offer.

This time around, instead of a Scheme, he’s going for a Takeover Offer. 

This might look like technical stuff, but there are some important differences between the two.

By going for a Takeover Offer, Lavery has made things easier for himself. 

Whereas previously there were two different meetings and two different votes, now there’s only one. 

The Court meeting is no longer needed so the hurdle rate has gone down. 

Whereas before Lavery needed 85% of the votes to buyout everyone and take the company private, now he just needs 75% of the votes to take the company private without the need to buy everyone out.

Yup, that’s right. 

Now Lavery can take the company private even without buying out all of the remaining shareholders.

Only if he gets 90% of the votes, will he be able to buy out everyone for 82.5p. I believe the odds of that happening are very low.

My first thought was “does this mean that if I vote NO, I will automatically become the shareholder of the private company?”.

After talking to a few fellow investors, it’s my understanding (from the image below) that shareholders voting NO will have 14 days to tender their shares in the case Lavery gets his 75%.