Will E-L Financial (ELF.TO) execute a Substantial Issuer Bid?

[SafetyinNumbers]

E-L Financial executed an immensely successful NCIB earlier this year and the shares still trade at the biggest NAV discount of all time.

 

The company raised $200m of 30yr 4% bonds and I think it makes the most sense to pursue a substantial issuer bid with that cash.

 

 

 

[ColdandRich]

I don't think it will be a SIB. I'm feeling something more, maybe a buyout of EVT or an acquisition of a new subsidiary company.

[SafetyinNumbers]

I don't think it will be a SIB. I'm feeling something more, maybe a buyout of EVT or an acquisition of a new subsidiary company.

 

I think an SIB would be more accretive that a buyout of EVT or an acquisition but you could definitely be right.

 

Also, while buying EVT has the fringe benefit of buying the ELF it owns, it’s controlled by the family anyway and to avoid tax they would have to keep all of their ownership.

 

I like there is almost zero interest in the poll and the name.

 

I was clamouring for a buyback for years at the AGM and I have to give Duncan credit, he didn’t swing until he saw a fat pitch with the NCIB, in what were scary markets. The family bought a ton of stock last fall and then the company bought 20% of the free float (5% of shares outstanding) in two months and the NAV discount is bigger! A SIB seems like the next logical step and would be legendary from a value creation standpoint.

 

Companies don’t get many chances to make a potential 100% return on every dollar they spend on the day they spend it.

[oddballstocks]

Just received a tender offer in the mail.  Looks like they're trying to acquire 3.5-4% of the company again, so another big float reduction if this goes through.

 

Reading through the offer, they've purchased slightly over 200k shares this past year and this will be another nice chunk.

 

This has been an extremely boring holding, but the company keeps doing the right things.

[SafetyinNumbers]

Just received a tender offer in the mail.  Looks like they're trying to acquire 3.5-4% of the company again, so another big float reduction if this goes through.

 

Reading through the offer, they've purchased slightly over 200k shares this past year and this will be another nice chunk.

 

This has been an extremely boring holding, but the company keeps doing the right things.

 

I totally agree.

 

I’m sure you are aware of this but for anyone else who might happen upon it. There is a big deemed dividend for Canadian resident investors in taxable accounts for shares tendered to the offer and I think the tax treatment is also terrible for US residents (in taxable accounts at least).