RE:RE:RE:RE:RE:RE:RE:RE:Just OutJudging my today's market action, the stock is headed lower, and no doubt the pressure will be on the dissident group to maintain their stand, if the No vote prevails.
Nevsun is not under pressure to do the deal. The main shareholders are big, and have been sitting on the stock, pocketing the dividend., for years, one of which they cashed in today.
In the event the No vote prevails, it will be a slim margin. I estimate around 3 million shares max. Maybe even less than that. In that event, I can see an extended management and NSU extending the closing period, maybe 45 days, to let the summer heat take its toll on the dissidents. Obviously the Red Dragon, doesn't have the cash to offer a better alternative, but they have been able to persuade others in joining their cavalcade. I rather doubt that the non-chinese dissidents are really enamoured on the fact that the Red Dragon has acquired more shares and is intrerested in taking over the project on the cheap.
Thus, I expect things to either get resolved tomorrow, if a private deal has been reached with sone dissidents, or we go through a simmering, agonizing period.
Based on today's market action, it would appear that the heat is being turned on and the stock is headed down.
Nevsun, can sit tight. If a better proposal emerges, they will cash in on the termination fee, the interest on the loan, ( I read it was close to 20%) and stock appriciation.
At the end the merger will get done, without NSU shelling out another 200 million or so. I'm surprised that they didn't, couldn't buy off some dissidents through a private deal.
But, the Red Dragon has played the game well. Good street fight, thus far.