Can’t see how this is a good deal for shareholders.
PDN in 2007 valued this company at over $1billion, at the time SMM had around $10 million in the bank and have since raised and burnt through approximately $26 million more.
Puts the $40 odd million takeover value into perspective....
I do understand the political environment in Queensland at present is anti uranium mining but this could change very quickly, especially if the uranium price starts to take off.
If this was to happen SMM would be worth multiples of the current price.
While PDN have some great assets, for now they also have a fair bit of debt and the cost of the C&M and eventual restart of their two mines. SMM holders will inherit these liabilities too in the event that this takeover goes through.
I for one would prefer for SMM to hold out for now and see what happens even if it means tipping a bit of cash in to keep things going.......
There is probably little anyone can do, but this is a very bad deal for all holders except of course PDN!!!
All IMO only.
SMM Price at posting:
20.0¢ Sentiment: None Disclosure: Held
