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This offer is not a straight forward affair as it involves the exchange rate of the ASD/GBP and the value of St Babs Shares. 150p was available when the news broke but since then it has slipped quite a bit. I'm a bit annoyed i sold out of allied at 121p as i could of had 150p but my buys were at eqv 252 and 176p (some on Aim before consolidation at 42p) so i was always going to lose out. Unless you bought in the last few months not many will have made much from this.
Up and down and so boring
nm
Looks a done deal. Worth buying at this price. St Barbara's golden handshakeStephen Bartholomeusz Published 2:50 PM, 29 Jun 2012 -------------------------------------------------------------------------------- inShare About a year ago St Barbara tried to gate-crash a Newcrest Mining-backed merger of Catalpa Resources and Conquest Mining in an attempt to create the leading mid-tier gold miner. Today it announced a different means to the same end. This time it is, however, different. Where the attempt to force a merger on Catalpa failed because Catalpa wasn’t happy with the exposure its shareholders would have had to the merged entity, St Barbara’s $556 million takeover/scheme of arrangement merger with Allied Gold Mining Plc is locked up, with the support of a majority of Allied’s shareholders. The ambition, however, is very similar. St Barbara has the very good, low-cost gold Gwalia mine in Western Australia throwing off a lot of cash. The mine, however, has a remaining life of only seven or eight years. Allied has producing resources in Papua New Guinea and the Solomon Islands and exploration prospects in the Pacific Rim that have considerable upside but where the execution has disappointed, which has resulted in a halving of the Allied share price over the past year. Bringing Allied’s less mature but long-life assets in riskier jurisdictions next to St Barbara’s developed operations and experienced management would create a bigger and more diversified portfolio of resources with longer term upside. The group would have three established mines, a fourth under development and some highly prospective exploration rights. In that respect the proposed merger, which would create a group with about $1 billion of market capitalisation, is not dissimilar in concept to the Newcrest merger with Lihir Gold, with the strong Australian base and cash flows enabling Newcrest to contemplate acquiring a group that had a chequered development and production history but a very substantial resource. Unlike the Catalpa proposal, St Barbara has ensured this merger will succeed, with 35 per cent of Allied’s capital committing irrevocably to support it and another 18.9 per cent verbally committing. That’s not surprising, given that the offer is at a 92.3 per cent premium to Allied’s pre-announcement share price. In another similarity with the Newcrest/Lihir merger there is a substantial overlap in terms of common shareholders, estimated at about 30 per cent. St Barbara attributes the meltdown in Allied’s price over the past year to its management’s failure to deliver on production promises. St Barbara chief executive Tim Lehany and a technical team spent two weeks poring over Allied’s mine sites and prospects and are confident they can better exploit Allied’s 3.2 million ounces or reserves and nine million ounces of resources to both lengthen the merged gr
The investment attraction of the merged group is compelling, being one of the largest production and resource/reserve based mid-tier ASX listed gold companies, with a diversified portfolio of quality assets operating in multiple regional jurisdictions. The combined group will have a declining cost profile and exciting growth potential through near-term project development and exploration upside."
Both firms have said they believe that the combination has a "clear strategic and financial rationale, is value enhancing, and provides benefits for the shareholders of the enlarged group". The move is aimed at reducing the investment risk profile through a more diversified asset portfolio, save costs, and have the largest gold reserves and resources portfolio of any mid-tier ASX listed peer company. St.Barbara, which last year failed to takeover Catalpa Resources, is one of the largest mid-tier Australian gold miners and has three mines and two processing plants at Leonora and Southern Cross, in the Eastern Goldfields region of Western Australia, and over 5,000km2 of prospective tenements across Australia. So far, 54% of Allied Gold shareholders have backed the merger, which is set to be completed by late Augst or early September. Mark Caruso, Chairman and Founder of Allied Gold, said: "The board of directors of Allied Gold unanimously supports the transaction and believes it to be a unique transformational opportunity with the potential to realise an immediate premium for shareholders. "The transaction has the certainty of cash consideration coupled with an equity component to enable participation in the significant upside potential of the combined group.
Shares in Allied Gold Mining rocketed almost 64 per cent on Friday after the mining company announced that it and fellow miner St Barbara plan to form a one billion dollar mid-tier miner by merging, in the largest deal of its kind since late 2010. Under the agreement, St Barbara will acquire the entire issued and to be issued ordinary share capital of Allied Gold, and shareholders will be entitled to receive A$1.025 in cash and 0.8 St Barbara consideration shares for each Allied Gold share held. The offer values the capital of Allied Gold at around £360m and each share at 176p, which represents a premium of approximately 92.3% over the closing price of 91.5p per Allied Gold share on June 28th.
Got ya - thanks for that. Yes Im in a quandry now too.....
this is it - the offer: "Shareholders will be entitled to receive A$1.025 in cash and 0.8 St Barbara Consideration Shares for each Allied Gold Share held at the Scheme Record Time" - (from this mornings release) and was valued at 176p but the St Barb (SBM) shares have dropped in value yesterday. So the 176p price is not a fixed price. ------------------------------- Good thing is gold price jumped today and hopefully SBM price might jump next week too. still need to decide what I want to do next.
but i guess you'll take the 176 per share
my average is 139p and was hoping to hold for a few years
Sounds to me like some people could be forced out at a loss. Me for one - I brought in at 264!!
over on iii board there is discussion of de-listing but I cannot see where this has been mentioned yet. Need to do some digging to understand what will happen.
Please visit the board yourself, too many bits to cut and paste. Notable - Thanks to holycustard (@9:54 today) for the explaination on the price. The de-list discussion is causing me a bit of concern at the moment as I hold these in an ISA.
Hi Bigloss Could you cut and and paste the comment on iii. Many thanks
So what does this mean for us small investors? Do we get a dividend and get to keep our stock holding? Sorry it's such a numpty question, but I am a numpty.
RECOMMENDED OFFER for Allied Gold Mining Plc ("Allied Gold") by St Barbara Limited ("St Barbara")
iii board is worth a read on this. Very quiet here.
Of 1.76 per share and sill at 1.50 good profit to be made if you can buy any gla..
offer 1.76...
Wow! whats this all about? Cannot see an RNS
But only if your in
bing - at these levels I do think this is a good buy - have a look at the edison research note - once the markets sort themselves out ( and that could be a while ) then ALD show be able to flourish -
http://www.edisoninvestmentresearch.co.uk/researchreports/allied290512update.pdf
I held allied for a while and bought in two tranches and and lost out on both times! Eventually i bailed out at 121 with a loss but it could still have been worse if holding today. It's funny how you always hear of 'undervalued shares' but why does it keep on going down? I have seen buy recommendations on Yell at 10p now you'd be pretty much wiped out.