RE:RE:RE:Do we get to vote on this merger ??Hey 00Bill, but why do you think AKG shares is now worth only $1.70 whereas it was holding strong at $2.10 before the announcement?
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It's all because AKG is spending more (in terms of AKG shares) to acquire PMV's $100mil cash...., it was valuing PMV $183mil for its $100mil cash.....see link below.... Current market does not care about the gold in the ground anymore. As I said, after the merger, the two companies combined will have roughly $280mil in cash with 180mil shares O/S..... that is $1.55/share in cash. Hence it is trading at $1.70.... PMV share which is worth 0.201 share of AKG is now trading at $1.70 * 0.201 = $0.34 which is correct.
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With the arrangement of the merger - a share exchange, NOT a buyout, you cannot hold onto the $0.46 assumption anymore, PMV will be traded very closely with AKG sp by that factor of 0.201.
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This deal is just like the BTO - VTR deal.... If you did not like it at the time, you should have sold PMV at $0.46 at the time (like I did with my VTR shares at $0.41 which subsequently dropped to low $0.30s). BTO bought out VTR with a share exchange ratio of 0.15.... when the deal was announced, BTO traded at $2.80.... hence VTR jumped from $0.23 to $0.42 (=$2.80 * 0.15)..... Then BTO trending lower to $2.20..... VTR followed suit to trade at low $0.30s and now the deal is done.... VTR delisted.
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Analysts at Scotia Capital are backing Asanko Gold Inc.’s (TSX: T.AKG, Stock Forum) $183 million deal to acquire PMI Gold Inc. (TSX: T.PMI, Stock Forum), saying the combination makes sense given synergies that arise from the companies’ assets in Ghana, West Africa.
Read more at https://www.stockhouse.com/news/natural-resources/2013/12/19/asanko-t-akg-sought-macquarie-s-backing-prior-to-pmi-gold-t-pmi-deal#FD4olxd6GHe1HKlo.99