I read some not so encouraging comments about the merger between Kumari, NCCB and other four. The primary reasons are that from now on there will not be possibility for bonus/rights shares and the money will be blocked for several months due to merger. In a heavily traders dominated market like NEPSE, these concerns are quite reasonable. Also, when the merger completes, one effective strategy that of rumor will have less influence as it is effective in a platform that of bonus/rights shares. I have full sympathy with trader friends.And, also I have soft corner towards rumor merchants as they provide entertainment free of charge.
For investors, it is healthy to have a strong company to have their investment. They have fairly ready business area and clients coverage. Their problem will be bringing together conflicting management practices, company cultures, business modules and streamlining them as chemical compound. This is a big challenge. Globle IME has been fairly successful and the new entity (may be KCCB?) could learn from their experience. Investors are primarily interested in reasonably safe investment and satisfactory dividend. And, a merged entity could make this possible from the very beginning as that will have amalgamation of existing capital, clients, infrastructure, goodwill and enhanced image.
All the best to a new chemical compound and the owners of that entity - the shareholders of the six companies.
Disclosure: I have no shares of any of the six companies and had none in the past too
Disclosure: I have no shares of any of the six companies and had none in the past too
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