After buying a small stake in Southern Cross Healthcare on Monday, news emerges today that they are the subject of a "highly preliminary proposal with relation to a potential offer". That was enough for a 56% jump in their share price, making them the top riser of the day.
As usual in these matters, events occurred in completely the wrong order. First there was a 30% jump in the share price, then a statement from Towerbrook announcing an "indicative non-binding offer" (which triggered a further jump in the share price), followed by a sceptical response from Southern Cross: "the Board of Southern Cross has informed Towerbrook that it does not wish to enter into discussions at this time".
That triggered a brief downward blip, but the share price recovered to finish the day on 28.5p, up from 18p at opening.
I briefly thought about selling at 28p, but I've decided to hold on and see what happens. Southern Cross started off so cheap that Towerbrook could still afford a pretty massive premium over the current price, and I did buy on the basis that they were worth 40-80p.
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