OTCPK:KRCLF - Post by User
Post by
MaterialsManon May 14, 2023 7:31pm
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Post# 35447579
Maybe a stupid question
Maybe a stupid questionNewcrest announced today that the board is recommending approval of the takeover proposal from Newmont. Assuming the deal happens, it will be the largest in the history of the gold mining industry.
The question I have involves the U.S.dollar value of the deal when it closes. NEM is offering 4/10ths of a share for each NCM share. At the current NEM SP, it makes for a 17 billion dollar offer. When the initial proposal came out, NEM's SP was higher making the deal worth about 20 billion at the time. I do have a little NCM in my wife's IRA. Consequently, I have some personal interest in what is happening.
Here is my question. For the sake of keeping the arithmatic simple I will use round numbers. Right now, NEM is say 50 dollars. That makes NCM worth 20 dollars. So, if the merger does not get approved until the fall, and in the meantime NEM goes to 100 dollars, do the Newcrest shareholders get 4/10ths worth 40 dollars, which would make the deal worth 40 billion. I feel a little confused about this because this is not spelled out in plain english under the terms. Plus, the headlines do not help. Could anyone who reads this board be willing to shed some light for me? Thanks.