Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

[Libertarian666]

What is the SBT units?

How many percentage units does Sprott need for the conversion to succeed?

They need 2/3rds, and that assumes that they don't get pushback for what amounts to an end-run around the governance rules.

[Reub]

How can they be asking me if I want to swap shares if they don't control those shares? What kind of crap is Sprott pulling? And why would my brokerage relay this message to me?

[Libertarian666]

How can they be asking me if I want to swap shares if they don't control those shares? What kind of crap is Sprott pulling? And why would my brokerage relay this message to me?

They want your proxy so they can take over GTU/SBT. If they get enough proxies they can throw out the existing management and put in their own management, then take the gold to add to their stash.

[MachineGhost]

They want your proxy so they can take over GTU/SBT. If they get enough proxies they can throw out the existing management and put in their own management, then take the gold to add to their stash.

Sounds like a hostile takeover which isn't surprising.  If you had a personal piggy bank and someone tried to steal it from you because they felt you were living too high on the hog, you wouldn't go willingly either.

[steve]

I have been a long term GTU holder and hope that Sprott gives up, this attack is costing GTU unit holders additional expenses and are hampering with the smooth operation. It makes no sense to me for any long term GTU holder to agree and exchange to Sprott where they will pay more in expenses and have no say in management.  Only the very large holders can exchange for bullion and that is at the expense of the smaller holders. GTU is also implementing a cash redemption for all holders at 95% nav which is superior to Sprott.  If Sprott somehow succeeds I plan on selling. I am looking into the Merk Gold Trust called ounz and other alternatives for online easy trading to re balance and will consider holding more physical bullion.

[AdamA]

If Sprott somehow succeeds I plan on selling. I am looking into the Merk Gold Trust called ounz and other alternatives for online easy trading to re balance and will consider holding more physical bullion.

Me too.  I think GTU is a great fund.  This Sprott bid is very annoying.

[dualstow]

I would sell, too, except that I'd be selling at a big loss. Can't wait to dump all my paper gold shares when they break even, no matter who's at the helm.

[steve]

I would sell, too, except that I'd be selling at a big loss. Can't wait to dump all my paper gold shares when they break even, no matter who's at the helm.

Selling at a loss is not always a bad thing if you can do a tax loss harvest. I also like to have real bullion which I call my core gold, but I also like to have some that I can easily manage online  to re balance. If you have GTU in a non taxable account then you can not do a tax loss harvest, but you also do not have to deal with the special tax forms for GTU or PHYS if held in a taxable account.  I have been a very happy GTU holder and will keep it as long as Sprott is not successful.

[Reub]

Why would reputable brokerage houses like Vanguard forward these messages to me? Don't they see that I am being spammed and misled by Sprott? I mean, how can they ask me to swap my shares if they don't have the right to?

[MachineGhost]

Why would reputable brokerage houses like Vanguard forward these messages to me? Don't they see that I am being spammed and misled by Sprott? I mean, how can they ask me to swap my shares if they don't have the right to?

Its a legal obligation for shareholders of record.  That's what brokers do.  If you owned individual stock, you'd get forwarded annual reports and proxy votes.

Since Sprott is trying so damn hard, I say hold on to the shares and let them sweeten the bid if they're that desperate to rescue the shareholders from cronyism.  Either they'll pay up or they will go away.  They already upped it by .10 per GTU unit.

I thought this was interesting...

Sprott is committed to providing GTU and SBT unitholders with an opportunity to own a superior product. In order to reach these unitholders, as is common in transactions with a large retail base, Sprott has agreed to pay to each soliciting dealer a solicitation fee of US$0.1358 per GTU unit and US$0.0448 per SBT unit deposited through such soliciting dealer if such unit is either (i) taken-up and paid for under the applicable Sprott offer, or (ii) provided the Merger Transaction (as defined in the applicable Sprott offer) is completed, deemed to be withdrawn from the applicable Sprott offer under the Merger Election (as defined in the applicable Sprott offer), subject to a minimum fee of US$50.00 and a maximum fee of US$1,500.00 with respect to each beneficial unitholder of GTU or SBT and a minimum deposit of 300 GTU units or 1,000 SBT units. Where units deposited and registered in a single name are beneficially owned by more than one person, only one minimum and maximum amount will be applied.

[dualstow]

Catching up on recycling weeks' worth of offers sent to 3 accounts. Good God. At this point, I just want to dump non-physical gold because, ironically, of all the physical toil and time spent with this paper work. Not reading it, just shredding and recycling it!

I would sell, too, except that I'd be selling at a big loss. Can't wait to dump all my paper gold shares when they break even, no matter who's at the helm.

Selling at a loss is not always a bad thing if you can do a tax loss harvest. I also like to have real bullion which I call my core gold, but I also like to have some that I can easily manage online  to re balance. If you have GTU in a non taxable account then you can not do a tax loss harvest, but you also do not have to deal with the special tax forms for GTU or PHYS if held in a taxable account.  I have been a very happy GTU holder and will keep it as long as Sprott is not successful.

[MachineGhost]

Catching up on recycling weeks' worth of offers sent to 3 accounts. Good God. At this point, I just want to dump non-physical gold because, ironically, of all the physical toil and time spent with this paper work. Not reading it, just shredding and recycling it!

Calculating his velocity (roughly 5 m/s2) suggests that this mountain (of which we cannot see the summit) has a slope of 35 degrees, putting a rough estimate of the entire hill at 73.5 billion. Is it possible that McDuck pushed together his wealth to make this monstrosity? In theory, yes, but the eye line of McDuck (fixed at 8 degrees above the horizon relative to the slope) suggests that there are at least two other such mounds, putting his total wealth at over 210 billion, and well beyond the meager 70 billion of richest man in the world Carlos Slim Helu. It’s also heartening to see cash in this picture, as a diverse portfolio is always a successful one.

[dualstow]

haha, love it!

[LazyInvestor]

What's going on here? I've been receiving some notices, but I was ignoring them. Sprott managed to take over?!

[dualstow]

Not that I know of. I've gotten offers again pretty recently.

[Reub]

It seems that Sprott can continue this process ad infinitum, in which case they will probably win eventually. One thing that I have noticed is that the NAV of GTU has been outperforming GLD over the past 3 months by 3.5%. Mere coincidence?

[steve]

I capitulated, I sold all my GTU that was held in taxable account to take advantage of a tax loss harvest, I bought IAU which has a low expense ratio. With Sprott extending the offer another time I thought this was a good time to get out. GTU expenses have been going up because of the Sprott hostile take over battle, I know that I do not want to own Sprott PHY because of high expenses and the way the company operates so for now I'm out. One of the key things about the PP is that you do not have to worry or follow it so close. I was happy with GTU and more then likely I would have just held without doing a tax loss harvest, but the thought of having to figure out my taxes and new tax forms  if Sprott takes over succeeds  was part of my reasoning to get out.

[dualstow]

I'm envious, Steve. For me it would not be a loss harvest, just a loss.

[Libertarian666]

Now Sprott is attacking the GTU trustees for running up legal bills defending against a hostile takeover... initiated, of course, by Sprott!

"Over the first nine months of 2015, the GTU and SBT Trustees have spent in excess of US$7 million of unitholders' money on litigation they initiated and campaigns against parties seeking change at the respective funds."

(from http://www.marketwatch.com/story/sprott ... 2015-11-11)

I think they have generated a new entry for the definition of "chutzpah". 

[AdamA]

I'm going to start mailing all of the notices I get in the mail back to Sprott.

They will have to hire hundreds of new employees to manage this volume of mail.

[Phalanx]

I'm with you, AdamA. Getting pretty tired of the junk mail Sprott is sending. Was even called at home, ugh.

[AdamA]

http://m.marketwired.com/press-release/ ... 074806.htm

Maybe this is their way of trying to get Sprott to leave them alone.

[Reub]

11/26/2015

"Today, Central GoldTrust ("GoldTrust") entered into a new definitive agreement with Purpose Investments Inc. ("Purpose") regarding the conversion of GoldTrust into a gold bullion exchange traded fund ("ETF") managed by Purpose and Central Gold Managers. The proposed ETF conversion,  which is subject to unitholder approval,  has the unanimous support of your Independent Trustees and represents an exciting opportunity for GoldTrust unitholders."

"The proposed conversion is expected to immediately result in the units trading in-line with net asset value ("NAV"), to eliminate any material future discounts to NAV and provide unitholders with significantly enhanced liquidity,  consistent with other gold bullion ETFs."

"Put simply: the proposed ETF conversion represents a clearly superior alternative for all GoldTrust unitholders compared to Sprott's inadequate offer."

[dualstow]

Interesting development.

[dragoncar]

What does that mean for us?  Higher expenses?  Different taxation?