RE: RE: RE: RE: What makes SRX so valuable? I wrote BMX and asked them to clarify the formula. I have posted their reply below. The formula they give doesnt give the answer they give- unless you add some brackets around the (.56-.132) part.
In any case, the value to BMX shareholders would be exactly as amp7 shows of:
.132/ share cash + ( .1103 X SRX price)
So here would be the value for various Storm prices:
| Storm Price | Bellamont offer value |
| | |
| $4.00 |
.57 |
| $3.80 |
.55 |
| $3.60 |
.53 |
| $3.40 |
.51 |
| $3.20 |
.48 |
| $3.00 |
.46 |
| $2.80 |
.44 |
As per BMX's email, todays Storm close of $3.11 would give a BMX share exchange value of $.4751
I sold 1/2 of my remaining position today at .45 as I am concerned that Storm has been in free fall for the last 3 months and I am wondering why BMX is offering to sell at well below NAV (Btax, 10% discounted) of around .76 (from First Energy Nov 2011), when recent MandA has been at premium (Crescent Point, Pembina pipeline purchases).
Here is their email:
Dixon, the ratio of 0.1445 is set. It was based on .56 per Bellamont share and $3.88 per Storm Share (this was Storm's 20 day volume weighted average trading price on the date we signed an LOI). Remember they are also offering $20.0 million of cash at $.56 per share. As a result, the consideration per Bellamont share is calculated as blend of cash consideration and share consideration. At Storm closing price today of $3.11, the total consideration would equate to .4751 made up of .132 cash (i.e. $20.0 million divided by 151,562,699 BMX.A shares) and .3431 of share value (i.e. .56-.132/$3.88 * $3.11). Ultimately the final value paid to Bellamont shareholders will float with Storm's share price. We are expecting them to trade up as they get out and tell the story. The Storm team is very well respected and has historically been traded in upper end range of our peer group. The weakness of gas pricing since the new year has not helped our cause, but we believe the Storm will trade up in due course. Hope that helps, Steve Moran, President and CEO, Bellamont Exploration.