Woodford watch – P2P Honeycomb merger off? – Sky News has a story which you can read here – that merger talks between P2P Global and Honeycomb Investment Trust have collapsed following objections from “several” shareholders in P2P including Aberdeen Standard Investments and Premier Fund Managers. The tie up makes logical sense in that both funds have similar objectives and are both managed by Pollen Street. However, the principal objection is said to have come from P2P shareholders worried about an overhang of 22% of Honeycomb held by Woodford Investment Management.
[A few thoughts come to mind: One how is it that Honeycomb is still trading at a premium? – the share price is £11.10 against an NAV of £10.14. It seems quite likely that the price will slide now (but against that the shares are held quite tightly). How have the talks got this far without being disclosed to the stock exchange? And, if they were happening, how was P2P able to carry on buying back stock while in possession of some fairly major inside information?
To us, the tie up still makes logical sense and would be fairly easy to structure in a way that gave P2P’s shareholders comfort about any overhang. Honeycomb should create a separate realisation pool, put Woodford’s stake in it and that of any other shareholder who wants out of that trust, and give them a separate class of realisation shares. We must now watch to see whether the story is confirmed.]
P2P / HONY : Woodford watch – P2P Honeycomb merger off?
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