The following notice outlines ASX Clear’s ETO adjustment approach if Seven Group completes the off-market acquisition of Boral.

Under the current offer BLD shareholders are eligible to receive 0.1116 SVW shares and up to $1.44 ($1.70 less a special dividend of $0.26) cash for each BLD share held at the scheme record date. The $0.26 special dividend was adjusted by ASX Clear on 16 April 2024.

If the scheme becomes effective, ASX will create a new Exchange Traded Option (ETO) listing for SVW and convert BLD ETOs Open Positions in into an equivalent SVW position (a new ETO listing) under Procedure 2230  with further detail in Appendix 2230  of the ASX Operating Rules.

Note: The amounts used in this notice are based on the current information provided in the latest BLD announcement and may be subject to change. This notice is to advise the approach ASX Clear will adopt if the conditions of the off-market takeover are met. A further notice will be released confirming dates and finalised adjustments.

Under the current offer, BLD shareholders will receive 0.1116 SVW shares and a cash amount of $1.44 ($1.70 less the special dividend of $0.26 paid by BLD as adjusted by ASX Clear on 16 April 2024) as the consideration price when converting to SVW ETOs.

 BLD ETO Adjustment

Provided the Scheme Offer becomes effective, ASX Clear will after the close of business on the last date of trading in Boral shares (TBC) convert BLD ETOs into new SVW options using the following approach:

OC = old contract size    

TC = theoretical new contract size (prior to any rounding) which is used in intermediate calculations

      = the final number of SVW shares under the share component

      = 0.1116*100 = 11.16, using old contract size of 100

NC = Adjusted new contract size (after rounding) = 11

      = 0.1116*104 = 11.6064, using old contract size of 104

NC = Adjusted new contract size (after rounding) = 12

The difference, due to rounding, between the theoretical new contract size and the adjusted new contract size, will be cash adjusted using the ETO cash equalization adjustment payment formula detailed in the final notice.         

• the strike price in each Series will be adjusted for the Cash component, and in reflection of the reduction of the cash amount, using the following formula:

          New Strike Price = (Old Strike Price – Cash Consideration)*(OC/TC)

                                        = (Old Strike Price - $1.44)*(OC/TC) 

Note: BLD currently has two contract sizes of 100 and 104. These will convert to 11 and 12 respectively after the adjustment to SVW.

In the adjustment method for the Scrip and Cash Offer under a merger, the value of the total exercise after the adjustment is equal to the value of the total exercise before the adjustment less the cash consideration amount.

OTC series

Clearing Participants are advised that any OTC series cleared by ASXCL under the ASX Equity OTC Clear service will be adjusted using the same formula as the ETOs as shown in this Derivatives Notice. 

OTC series will be adjusted along with ETO adjustments on the night however, to maintain anonymity; the adjusted OTC series details will not be published in the Derivatives Notice but will be available to CPs the following morning via their own clearing systems.

ETO exercise restrictions (where any) in relation to an adjustment may occur during the period of 10 business days prior to and including expiry, will also apply to OTC series. However such exercise restrictions will not apply on expiry day of an OTC.

Specific Cover

Participants are advised that as multiple contract sizes are changing, arrangements may need to be made for additional lodgement of underlying shares to account for any collateral denoted as specific cover.

What do I need to do by when?

Participants should be aware of the content of this Notice as it sets out the treatment of the proposed takeover of BLD by SVW with respect to open positions in ASX BLD ETO contracts.

A further notice will be issued if the scheme becomes effective confirming the adjustment approach for the BLD and SVW merger.

Need more information?

Issued by

Greg Fitzpatrick, Senior Manager, Clearing Operations

Contact information

Clearing Operations

clearing@asx.com.au

Disclaimer