Post by
matt2018 on Dec 10, 2019 6:00pm
Understanding the deal
Love the market reaction, but do I have this correct?
Shares outstanding before the deal were 107.6M
They are adding 59.8M new shares for a total of 167.4M (56% more shares).
19.2M shares to Barrick, 1.6M shares to minority owner, 11.1M shares sold to Tablo,
27.5 shares sold to public
Debt goes from $189M to $414M ($225M to Barrick).
Proceeds of the shares sold to Tablo and public of $151M cash.
($75M of this to Barrick, $76M to TGZ corporate).
Cash goes from $28M to $104M for a plus $76M.
So net debt changes from $161M to $310M for a difference of -$149M.
So the purchase price for the asset comes down to:
$149M plus 59.8M shares.
all figures are US$
Comment by
ruffus23 on Dec 10, 2019 6:19pm
changes tgz from having two B grade mines to having a world class deposit. Will have tgz added to more indexes and more institutional interest.
Comment by
ruffus23 on Dec 10, 2019 6:20pm
no insider buying, is there a blackout period or something?
Comment by
matt2018 on Dec 11, 2019 6:48am
What I was alluding to was that as much as I like the asset (seems a nice fit for TGZ), 56% more shares to be issued (plus added debt of $149M US) seems a little steep in relation to where TGZ was valued before this deal (all things considered). I suppose that could also mean that the company was way undervalued pre-deal.