deal valuation

There is a thread in AVX talking about the valuation of the deal but no similar talk here in PGL.

Relative Valuation by PGL board :
By using relative comparision, PGL board boosted that "Exchange ratio is based on Avexa's current share price of AUD$0.105 per share and an implied value of AUD$1.35 per Progen share".

This value from PGL board is misleading. PGL shareholders do not trust their board and they are selling their shares at below $0.72 per Progen share.

Absolute Valuation :
From AVX thread, an absolute valuation "... this deal is equivalent in its cash raising and dilutionary effect to a placement of 542.5m Avexa shares at .092 each raising $50m. Raising cash at a 10% discount is not a bad result in todays market".

The deal is not bad for AVX in the todays market. AVX also get the PGL intellectual properties as bonus on top of the needed cash.

What does it mean from PGL shareholder's point of view ? It means after the share buyback and the merge, effectively, PGL shareholders buys 542.5m Avexa shares at $0.092 each, totally at $50 millions.

For PGL, spending $50 millions to buy Avexa at 9.2 cent per Avexa share is not a good deal. Avexa's share price was around 10 cent before the announcement. After the announcement, the market values Avexa share around 8 cent per share.

Effectively, the valuation of the deal is : PGL buys Avexa at 9.2 cent per Avexa share. PGL shareholders, are we happy with that ?