A 0.25 ratio should be fairI have done some simple math and it seems to me that a ratio of 0.25 SLW shares to 1 SST share should be a fair price.
I took into account the production growth profile that the new SLW will have (and today's SST have not).
The new SLW debt situation will not be bad since they would be able to pay off all of it from cash flow in less than 1 year assuming $15 silver price (or about 18 months at $10 silver).
On the plus side, new SLW will be much more diversified by primary metal mined and by having more than just two companies as counterparty risk (well, more than half of production will come from one company but this company is named Goldcorp).
SST share appreciation potential will remain intact at 0.25 conversion ratio (if you keep the new SLW shares, of course).