The Tata CNS bid for Corus has dominated business headlines for days. The price war started with the TATA’s offering 455 pence per share (company value at 4.3 billion pounds) The present offer is 515 pence a share from CNS compared to 500 pence per share from the TATA’s (company value 5.7 billion pounds and 5.1 billion pounds respectively).
The media has been awash with speculations of what the TATA’s might do and what CNS might do. Theories and counter theories of market dynamics. About which company would be a better suitor. Which company would be able to synergise with the company better and what not. Some people have even gone as far as saying that Corus felt it was undervalued by the TATA’s and wanted to increase its valuation by getting CNS to offer a better price.
But there is one important statistic that has hardly been talked about since the first report. Since CNS already hold a 3.8% stake in Corus, even if they fail to win the price war they will still laugh all the way to the bank. 3.8% of 0.8 billion pounds (difference between the two TATA offers) is a comfortable 30 million pounds.
A related article on Canary Warf that had the same price war
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