MagIndustries Corp MAAFF

General Comments

[Ethanbrodie]

I have just joined this community and actually was viewing the board for quite some time now.

I have bought here and there with Mag shares over the past year and a half or so and recently upped my position significantly.

I do believe that this deal will get done, it is only a matter of time...

There are a few things that may be going on here which i will rank from 1 and on from the most probable to the least.
1. China has been always "known for taking their time." They will do it their way or the highway. Usually when the board of a major company ("knows what's best for the company") approves and accepts terms to be drafted, the government etc.. will eventually follow suit.If that was not the case, there would be a lack of support for each other, potentially create conflicts of interest especially since SDIC is the Major shareholder of the company. If the SDIC did not have "adequate" time to review all documents and consulted with each other etc.. they would not care less if there was a deadline of  the end of august. They realise that mag will end the exclusivity period but that is ok because itstill buys them more time to review the transaction. If there were to be another player, it would probably take a few months before there are very serious talks of a joint venture/buyout at the earliest. Behind closed doors, because of the beurocratic systems, SDIC may have hinted that they did not like that the PIA was not passed through law and/or told mag that that was necessity in order for the government to approve because of their way of following their system and risk control. 

SDIC knows that Mag is very interested in getting a deal done. Mag will always accept the offer from SDIC because Mag wants to fist give up a little to develop the first stage to get future financing of the other properties out of the way.I believe SDIC believe's that they have the ball in their court and could at any moment of their choosing get the deal done, so why the "rush" 

2. Because of the recent news on potash/ bhp takeover, they don't want to do anything drastic to upset a potential buyout/aquisition themselves of potash sask. They want to "see where this goes" first, then act on a potential deal with mag. Once they know what is going on with the big takeover story, it will be an easy decision to buy mag or not because of the past 7 months of negotiations with mag. They also believe they have a few months for this to play out.

3. If in fact there are companies that want to buy mag or do a joint venture, it is at that time SDIC may come into play and convince them that they have the leverage to reduce the capex ect.. to add value and take the deal.

I believe there is probably a 70% chance we will see a deal in the next 2 weeks to one month. If there is no deal by 2-3 months, complant is probably out. By that time anyway, there will probably be another or many players to buy/joint venture.

Potash is going to go up in the future, companies/governments want to take advantage of the oppertunities out there, to secure potash imports of to hedge the rising prices. There will be a takeout / joint ventrue in the next year, especially when the ROC affirms their stance by passing the PIA into law. This will be a great story but rocky roads until then may be on the menu.

Ethan

LONG and SHORT