any one got a feelling in their water how far LLoyds will go looking to to buy but just dont know when they are low enough

It would be intresting to know in advance, what level of dividend will be retained for LLOY's.

The current sp relates to an equivalent of a 25% dividend or a PE of about 4.

I am watching closley for another overdone drop as a possible re-entry point into this stock.

Good luck to all holders.

Target price on the other side is 147p.

I think it will be considerably lower.

Fall in LLOY sp suggests market does not like proposed HBOS takeover in front of a probable collapse in the UK housing market next year. LLOY's directors are acting like Fred Goodwin did when he outbid BARC for ABN/AMRO. If this deal goes through LLOY shareholders do not get a dividend until 2010, why should they vote for the deal? Or are they all turkeys waiting for christmas.

I agree halifax it is really strange, except historically they wanted to strike a deal . . . .but then the Markets saw no wrong. The fact is "now" HBOS is a poison that could invade the whole LLOY business....and I don't like it, yet we are unlikely to be able to make any change, if that's what they want.
Let's not forget that Institutions maybe want a safe haven for their HBOS-investment. Furthermore, they don't care if LLOY does fail, as long as they can get out with saved faces.
LLOYDS appear to believe it's (still) a good deal... with a little tweek to the figure!

Down to 155p could go sub 150p today.

Only a matter of time until Lloyds pulls out of deal. The only benficiaries are Gordon Brown, shareholders that also hold hbod and don't want to be wiped out and members of Lloyds board looking for a peerage

LLOY wil def NOT pull out .... whby should they? ..... they have picked up a plum for the best part of bugger all, and further, the gov't which is (or will be shortly) a major shareholder, sponsored the whole thing

The market seems to disagree

the market is not, i think, saying the deal won't through, but merely that the lower LLOY falls, the less they will have to pay for HBOS .... meanwhile, buying/selling HSBC was much less of a gamble this morning!

Why do people think it will go lower ie 147p or lower does not make sense to me.


Edit..Hbos now following.

Cynic please explain why it is a good idea to buy the largest mortgage lender by market share in front of the imminent collapse of the housing market.

because even if it collapses, people will still need and need to pay their mortgages and in due course, house prices will start to rise again ..... there was absolutely no way LLOY would have been permitted to buy Halifax (HBOS) in "normal" circumstances

Concerns that the merger between HBOS and Lloyds TSB may collapse are hitting the shares of the two merger partners. The government has agreed to underwrite huge share issues from both banks and at current prices looks like it will be left with huge stakes in the pair, making a full-on nationalisation a possibility.

why should it collapse? ..... shareholders of HBOS may well not like the price they get, but the other alternative is zilch

I think that holders that bought Lloyds for dividend and cautious management will string the board up if they go ahead.

Why? My understanding is there will be no dividend for any banks who have taken this deal until 2010 So they're getting no dividend anyway I agree with cynic and hold LLOY so do the govt who will want this deal to go through.

Just had another look at the deal. The pref shares are callable after 5 years & therefore no dividend will be paid at least until then to Ordy holders. The Government agree to pay 173.3p for each Lloy share subject to existing shareholder claw back at 173.3p. If investors claw back nil, then Gov will end up with 43.5% of enlarged group. Imho the Gov probably hoped that sp would go above clawback price so its overall take up would be lower. Like other ordy holders, this is just dead money for 5 years without a dividend. After the Gov have secured an income on the prefs at 12% so they have got that in the can. Cynic, I cannot see how the fluctuation in the sps effect the price paid for HBOS, since it is an all share offer at .605 for every 1 HBOS. I wouldn't be surprised to see the sp rally to above the claw back price nearer to the time of the effective dates. Unless you feel that the ultimate plan is to nationalise this bank (which I don't), although I do not blame investors particularly with this shady lot, I think the deal has no choice but to go ahead. If the deal does not go ahead I think the Government would then make the appropriate move which would not be in shareholders interests. Once we can get a new Government the clunking fist may be removed.

Gus the difference between the share prices will either mean better or worse value if you buy HBOS ie 100 HBOS @ sp 80p = 80
100 HBOS = 60.5 LLOY @ sp 149=90.145

because i am being even more stupid than usual, though a falling sp means that the rights issue becomes ever less attractive

absolutely, so god forbid the there would be any manipulation but, it would not surprise me to see a rally above the clawback price. Will be interesting to see how it turns out.