The following are simply my opinions and could be way off the mark….so please, DYOR.
It seems to be generally accepted among posters that, following an announcement of (hopefully!) offtakes and finance... it will probably be swiftly followed by a takeover offer. So, rather than wait for that day, I thought it would be good to start a thread TODAY for those that are happy to discuss any takeover related issues….before it is too late.
Ultimately, for me, I would prefer CXX to mine Panda Hill. The publicised numbers stack up very nicely indeed and the future likely dividends look equally nice. But, when Grant sold his lot to Tremont, it was clear to me the Board had lost control of the outcome at that point. There have been similar based subsequent events so, an eventual takeover – most likely by Tremont - seems to be a foregone conclusion.
Without getting into conspiracy theories, one doesn’t need to be a Rhodes Scholar to realise some events have appeared to be very suspicious and, in fact, a giveaway. Some of my previous posts allude to these so I’m not going to repeat them all again but, as a loyal long term shareholder, I will be thinking very hard about how I should respond to any takeover offer. I do not think it is acceptable to simply accept the recommendation from the Board – without analysing all the options.
Based on available information, Panda Hill is a very valuable asset. We have already spent a lot of money and time getting to this point and we appear to be very close to the cusp of developing the mine. If the Board feels it is in its Shareholders’ best interests to abandon its very attractive long held business plan then, IMO, they will not only need to show us why, but will also need to set out the alternatives…..eg – is accepting a takeover financially better than selling the Company to a third party?
In terms of calculating “fair market value” for the Company, there appears to be several methods. It will be interesting to see which method is used in calculating any takeover offer price. For CXX, based on available info, I prefer the Capitalisation of the Cash Flow Method.
Yes, part of the legislative process includes considering what the SP level has been over the previous 6 month period but, as we all should know, a company with CXX’s fundamentals can have their SP manipulated very easily. And I am sure the likes of the ASIC know this too.
In summary, although I prefer CXX to mine Panda Hill, I am not totally against a takeover either….but unless the price is shown to be a fair and reasonable one (with the accompanying reasons by the Board) then I will probably be filling out the “Objections” form – which will form part of any takeover documentation.
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