RE:RE:RE:RE:RE:RE:RE:Merger circularTiny, thanks for the stars, and thank for the opinions. My opinion on the KDI price is that MPVD is paying for in-the-ground diamonds what the market is paying for in-the-ground diamonds; that is, about 10% of the estimated resource value. Now, as a KDI shareholder (which I am), I think it's equitable for both sides. MPVD gets resource plus blue-sky, and KDI gets liquidity. As an MPVD shareholder (which I am), MPVD gets resource plus blue-sky, and KDI gets liquidity.
Consider the path you propose: a low-ball MPVD bid for KDI forces KDI board to get a fairness opinion, and opens KDI to bids from third parties. If KDI is a strategic asset - for "big plan" reasons - for MPVD, then MPVD might end up having to pay more than the current bid, above a "fair" price.
So you, as an MPVD shareholder, feel the KDI price is 4x too high? If KDI were ONLY the identified resource (Kelvin + Faraday) and 100km away, I'd feel sympathetic.
BUT: MPVD may be incented to pay a very fair price to BE SURE to bring KDI back into MPVD (why was it spun out in the first place?) for reasons they cannot disclose, and at which we can only guess. DD is big on dividend, I recall. So Whittle is incented to manage MPVD to keep the largest shareholder happy, in that regard, or he walks the plank. From this deal, DD gets no cash; and if it sours, he loses both equity and bond value. So DD and retail shareholders are, I think, sharing aligned interests.
BUT MPVD knows (a) KDI is adjacent to the GK pipes and (b) KDI keeps finding more pipes and (c) I'll wager dollars to loonies that KDI has data, not quite ready for public consumption, about how promising some other targets are around Kelvin & Faraday. That's my speculation. I'll argue that MPVD is "paying up" because of location. It's become a pricey neighbourhood around GK. Gentrification? :-) Maybe it will get pricier if DDC/Washington folks (now run by PE) come sniffing around... Prima (ex-GGL) and Margaret Lake lands are possible temptations for speculators. Why now? Maybe there have been feelers, nothing at the reportable level, that someone was looking to offer on KDI. Idle speculation on my part, but enough to push Whittle into this action. Hence his cryptic "The timing is right" comment. He knows, but can't tell.
I can only guess, based on public info, what's really happening behind the curtains. But MPVD has been pretty straight with its shareholders over the years, so I have reason to trust them to stay on that path, even though Mr. Market may be somewhat attention deficit to MPVD on share price. As I've disclosed, I'm long MPVD and KDI. GLTA.