All Cash Deal - Who does it benefit?Laurion and the supercalifragioptomistics here will defend lthe insistence of the "All Cash Deal" like a positive. For who exactly? May not be you.
For the sake of argument lets look at what a stock deal for Laurion might look like.
I will use Barrick as the acquirer. Just an example. To make it simple, one share of Barrick for each share of LME. Barrick (GOLD) is trading at $17.33 USD, Laurion has 250M+ shares outstanding for an approx Laurion value of 4.3 billion USD or 13% that of Barrick. Except Barrick has been in a volatile period where the stock is bouncing between 15 dollars and 20 dollars.
If you have 250 thousand shares in LME, you have 250 thousand shares of Barrick. If Barrick shareholders dont like the deal there may be some pressure on the stock but a typical trading day of GOLD is 15 million shares so exiting your position without a significant loss should be easy. Except for the board and larger shareholders. They would be subject to lockups and other conditions limiting their abilities to sell their shares. On top of that the larger volumes would be felt and would limit returns for the F&F.
I wonder how they would react to a cash deal for the board and some privileged and stock for everyone else. How would you?
All for a healthy debate... but if you just want to bash me, can we just assume you have done it already?