Ann: Takeover Offer for Kalgoorlie Mining Company, page-4

re: Ann: NGF: Takeover Offer for Kalgoorlie M... In real terms pine15, they are offering us $0.0918c per KMC share if it is converted to NGF at 17c. (0.054 *NGF @ 17c).

KMC holders have little choice as the management own (I think around 57% of KMC)

Where KMC shareholders need to be REALLY careful is that NGF is VERY illiquid with more than 80% of the company owned by one shareholder. When KMC get converted into NGF there wont be any market for the flood of 70mill NGF which will go onto the market so shareholders will continue to be stuck with there shares for years or bail out at a much lower price than the current 17c.
I don't wish to be cynical, but it is highly likely that the KMC management will be able to transfer their shares to the NGF major shareholder off-market at an agreed price or at least keep their jobs with the NGF outfit.

I reckon it is a very poor deal - cash at 1c would have been acceptable but not shares in NGF. It is always bad when 1 shareholder has control of nearly the entire company, such as in NGF. He could mount a takeover of NGF for very minimal premium especially if the share price is manipulated down to under 10c (he only would need to move his shareholding upto 90% before he could compulsorily acquire the remaining 10%).

I will be agreeing to the deal because KMC has no cash and no chance of restarting the mine themselves so the directors will continue to burn through the cash, however, I will be holding off for quite awhile yet or selling KMC on-market.