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Questions of the Week – Share price purchase plans, Which bank? and more

Question 1. I’m a shareholder in Sonic Healthcare. Do you think the share purchase plan is worth taking up? I have a long-term perspective so am prepared to hold it for approximately five years.

Answer (by Paul Rickard): On the basis that the share purchase plan is at $19.50 per share, and on market, the shares are trading at $21.95 per share, it would seem like a “no brainer” to take up. It will probably be subject to a scale back.

I am a little more cautious about the acquisition of Aurora Diagnostics (this is the reason for the share purchase plan and institutional placement). While the market has given it the thumbs up, the history of Australian companies achieving immediate benefits from US acquisitions is pretty poor.