Scotia Raises Its Offer to $75 Per Share. Is It Enough?

Scotiabank is now offering minority shareholders seventy-five dollars a share to take Scotia Group Jamaica private — but is that enough?

The offer increased from $61.50 to $75 — almost 22% more.

For someone with a thousand shares, that’s an additional $13,500.

Scotia says the improved proposal reflects the Jamaican group’s strong second- and third-quarter results. The new offer is also about 27% above the stock’s closing price immediately before the announcement.

Minority shareholders are scheduled to vote on October 7. Completion still depends on the required approvals, including court approval.

Here’s what I want shareholders to consider: you’re exchanging your ownership for cash.

If you’re bought out, you give up your participation in future dividends and growth. So the question is whether $75 fairly compensates you for that future potential.

A premium to the trading price matters, but it doesn’t settle the valuation question. You also need to look at earnings, assets, dividends and the business’s prospects.

And if you’re thinking of buying shares now to collect the offer price later, remember that the transaction hasn’t been completed. That difference isn’t guaranteed profit.

The higher offer deserves serious consideration. But read the updated documents, understand the voting process and make an informed decision about your ownership.

And that’s the bottom line.

If you own Scotia shares, does seventy-five dollars change your vote?