SFF, Seafield adopts its own “poison pill”

From the website today;

The Board has adopted the Rights Plan in recognition that take-over bids may not always result in shareholders receiving equal treatment or fair and full value for their common shares. The Rights Plan is not intended to block take-over bids.  The Rights Plan grants shareholders rights  (“Rights”) pursuant to the terms of the Rights Plan. On the occurrence of certain triggering events, which include the acquisition by a person or a group of 20% or more of the outstanding common shares of the Company in a transaction not approved by the Board, the Rights will entitle the holders (other than the acquiring person or group) to acquire common shares of the Company at a significant discount to the market price. The Rights are not triggered by purchases of common shares made pursuant to a “permitted bid” (as defined in the Rights Plan) or where the application of the Rights Plan is waived in accordance with its terms.

The Rights Plan is not being adopted in response to any formal proposal to acquire control of the Company.


Obviously there is someone sniffing around. The stock has traded for some time now between 4 and 5 cents and we reiterate our buy recommendation for a trade only and with play money only. Moreover above 10 cents there are sellers galore so it would be something like buy at 4 and sell at 9 cents. The rights plan is effective immediately but will have to be confirmed at the next general shareholders meeting set for June 25th. Volume over the past few weeks is in the order of 10 mln. shares, not enough to reach the roughly 40 mln. to reach the 20% level. However certain parties may already own large blocks and there is also the possibility of exercising ( out-of-the-money!) options to make the point. We will see. In any event a further drawdown of the loan facility should be just around the corner.