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This should go into the 250 at the next rebalance which will, I assume, be ahead of the merger. Not sure how this will play out on the share price as rws is listed on aim I guess the indexes funds will have to buy in but then will they reduce from rws post merger? .
It was not on the Russel indicative list so I assume that the corporate action excludes its elevation even though its MCap ranking would be enough to gain entry.
At least it keeps it simpler this way and means that the rise today was not just index linked.
After that it did make it in. Will be interesting to see how this goes over the next few weeks; will the index's buy sdl also pull up rws as they are now linked?
I am not clear what to expect on the SDL's share price after the merger. Any ideas?
To be perfectly honest no...
RWS's is just over 600 at this price, they are paying a premium for SDL but then their price has dropped since the news. The FTSE index change rather muddies the water but I it looks like the market has settled on something around the current level.
Both companies held up OK through the lockdown and both indicate that things have picked up well since .
Originally I held SDL as a FTSE250 punt, picked up some more in the dip then sold out on the news of the takeover. Back in now that the price has settled. RWS has a good track record of growth and the fit between the business is good so I have decided to buy and hold for the midterm at least.
The combined company will have a lot of potential as an important global player in translation services.
I am lost. SDL is at 746, RWS is at 616. What will happen with the share price at the time of the merger?
At the moment - not a lot.
You need to multiply RWS share price by 1.2246 to get the value of SDL so they are about where you would expect relative to one another (at the moment SDL should be 758)
Well, I agree, however, I am still confused about the initial announcement which values SDL at 907 pence per share?
That was because RWS was at a lot higher price when they announced the takeover than it is now.
'Based on the Exchange Ratio and the Closing Price of 741 pence per RWS Share on the Latest Practicable Date'
If you multiply this price by 1.2246 you end up around 907