Post by
15Stanmore on Dec 21, 2020 10:05pm
Federal Government cancels SD Gold takeover
It was announced tonight that TMAC has received notification that the plan of arrangement for SD Gold to take over the Company at the shareholder approved $1.75 per share has been disallowed and the deal is annulled.
The Company is therefore now released from all its prior obligations under the plan of agreement, and SD Gold will walk away with its significant minority interest purchased last May at $1.75 per share which funded TMACs 2020 summer sealift.
We will now see what Plan B will entail. Given the positive operating results since the deal was announced, the Company likely has close to $100 million in cash on hand, and a quarterly positive cash flow of about $25 million. That puts the $167 million of debt coming due in June 2021 well within reasonable range to manage if the Company decides to keep operating on its own in the new gold price environment. Or maybe there is already a favourable buyer waiting in the wings. Not sure the current shareholders are still prepared to give up the company for $1.75 per share, although SD Gold would likely happily sell their holdings to recover what they paid.
Lets se what the market says at 9:30 tomorrow.