RE:Hey stockhouseUnkal, as feared the "wink wink" if this goes through you can negotiate a dissent and settlement with us later potential came to fruition. If Pentwater and Sailingstone had voted NO instead of abstaining (I'm assuming that's what happened today) then the offer of an upfront payment of part of the bid price plus "you can dissent if you want to" wouldn't have worked.
Thry still have to get a Yukon judge to bless the arrangement, but they have a fairness opinion and the endorsement of TRQ in hand, plus the vote results, plus the premium to the market they had created by making OT look risky with the Mongolians and their overruns and financing requirements.
SO, ASSUMING the deal goes through I'll make two predictions:
1. Pentwater and Sailingstone will never litigate the valuation, they will enter into a consolidated, confidential settlement AFTER TRQ is delisted.
2. ETG will now begin negotiations in earnest to settle the still unsigned (after 15 years?!!) JV Agreement, transfer of the two JV licences, and they too will never see an outcome of the pending arbitration of the original JV Earn-In Agreement negotiated with Friedland and IVN back in 2004. Post de-listing will Rio/TRQ share some drill results with ETG in confidence regarding the extension of HNE and/or other JV targets? Oh yes. And once they have done enough drilling Sandstorm's old 25% holding of ETG, now deftly slid into a non-trading (so far) new listing in Horizon Copper, will come in to support a lock-up buyout delivered by ETG management. The probable buyer as I see it will be OTLLC now that there are no public shareholders through TRQ Rio can structure some kind of financing deal with the Mongolians that will end-run any question of reopening the IA or parliamentary interference by ETG's interests automatically beingvsubjectbtobthe IA once owned by OTLLC.
The ONLY question is ... what price? The Trailer Park shares are going at a super cheap $1.16 CDN as of the close today. Nolan Watson of SSL and now Horizon drifted the thought last year he pegged ETG between $2 and $3 - ETG had previously commissioned the Edison Report that said more like $3.60 ... but the size and length of HNE remains fluid, thus the NPV of Lift 2. As does the issue of whether ETG takes a haircut on Mongolian ownership of 34% of the ETG carried interests, or whether on the other hand, the Earn-in should be read as saying IVN's "best efforts" to procure similar to IA treatment for ETG was on their ticket - which makes sense since all ETG was taking back was a carried interest and if it was subject to reduction the agreement should have been much more explicit.
So, to those of you who want to hang out at OT and enjoy more shenanigans ... is there upside in ETG? This punter's 8 Ball says "Yes", at least a premium to market like we saw outbid this deal, maybe, maybe, a crack at quite a bit better than that.
One thing is for sure. Unless Rio and Mongolia together decide they want to share some of the financial risk around with another entrant, like perhaps BHP, they have always wanted it all for themselves 2/3 to the financiers and operators, fully paid, 1/3 to Mongolia ... Scot Free!
Come have a flutter on cheapo, left-behind ETG, the water's great over in the Trailer Park!
cg