RTE 6:51:15The financial details of the takeover of WFC have been in the news again this week, with reports suggesting that the Irish company may raise a whopping €1bn in 2019, or as much as the combined value of the entire UK’s public sector sector.
With this latest update to the WFC deal, it is clear that WFC is unlikely to raise much more than this.WFC’s current share price sits at €1.13, but the company’s share price has been trading in the region of €3.20 since the announcement of the deal.
The share price of Wfc is currently trading at just under €3, but that may change, as the company is expected to announce a new stock offering to the public soon.
It is possible that Wfc may also announce a spin-off of its assets into a new entity, as reported by Business Insider earlier this week.
The spin-offs are highly unlikely to take place this year, however, as it is highly unlikely that the new company will raise more than €1 billion in 2019.
If the Wfc takeover does go ahead, then the financial details for the company will be very different from what has been reported so far.
If WFC were to raise €1,000bn, it would have to pay out a total of €20,000 per share, which is considerably less than what the combined UK public sector has to pay in 2019 for its combined assets.
This would mean that WfC’s share value would be €4.6bn, not €5bn.
This difference in share value will mean that it is far less likely that WFS will raise the money required to complete the spin-out of its holdings into a company.
The company is currently the largest publicly listed company in Ireland, and it will be interesting to see what it decides to do with its shares.
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