RE:Buyout price dependent on AEM stock price?DKoTrader -
From the Cayden website itself and consistent with what Ivan Bebek has publicly stated, the following will answer your question:
Toronto (September 8, 2014) – Agnico Eagle Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle") and Cayden Resources Inc. (TSX-V:CYD) ("Cayden") are pleased to announce that they have entered into an agreement (the "Agreement") pursuant to which Agnico Eagle will acquire 100% of Cayden's issued and outstanding common shares, including shares issuable under outstanding options and warrants, under a plan of arrangement (the "Arrangement") for total consideration of approximately C$205 million, or approximately C$3.79 per share (based on Agnico Eagle’s volume weighted average price of shares on the TSX for the 30-day period ended September 5, 2014). Under the Arrangement, Cayden shareholders will be entitled to receive 0.09 of an Agnico Eagle share and C$0.01 for each Cayden common share. The offer represents a premium of 42.5% to the volume weighted average price of Cayden shares on the TSX Venture Exchange for the 30-day period and an 51.9% premium to the 60-day period, both ended September 5, 2014 (the last trading day prior to announcement of the transaction).
From this, you can see where the figure $3.79 comes from. It is "based on Agnico Eagle’s volume weighted average price of shares on the TSX for the 30-day period ended September 5, 2014."
This does not mean you will receive $3.79 per share of CYD plus a penny. It means you will receive 0.09 or nine one-hundredths of an AEM share plus a penny. If the price of AEM is down, as now, you will receive considerably less than $3.79. If it is up, as I expect it to eventually be, you could receive considerably more. In other words, this is not a payout in absolute dollar terms but in absolute share terms. If AEM goes up, so does the transaction value to shareholders.
In the interview with Jay Taylor a few days ago, Bebek equilibrated the conjectural share price of CYD at $6.30 were AEM to reach $100.
Don't be put off by the present dismal action. It is temporary unless the laws of mathematics have been repealed!
Hope that helps.