Thoughts, Commodity Discovery fund6 Sep 2018 15:18
From hot copper
William Middlekoop - Founder of Commodity Discovery Fund {Dutch}
"This Solgold takeover battle will take several rounds and at least a few months imho."
[Embedded article: "BHP buys Solgold stake as battle with Newcrest heats up."-AFR, Australia]
My comment:
There are 2 ways of going about it [HYPOTHESIS]:
1) Acquiring 29.95% Rule.
2) Acquire Solgold shares {substantive?} and then TENDER an offer to Solgold eg Orbis Gold.
The Acquirer: [Currently has 6.1% Solgold shares per Ann 5 Sep 2018]
1) Cornerstone has 10% of Solgold shares appoximately per the previous post just printed.
2) AFR wrote that TenStar Trading, JP Morgan & Blackstone could be approached.
STEPS: [Theory]
1)The next buying of Solgold may in theory have to be a further PREMIUM to the 26.59p paid to Guyana for its 6.1%? Norm in mkt as no one sells wanted stock at NIL premium?
2)Cornerstone has indicated they want to extract value hence the original idea to spin out their non-Cascabel projects into a separate co. So, appears Cornerstone wants to sell out, hence enhanced their Cascabel project with 10% Solgold shares. Another PREMIUM may also have to be paid for their shares. However, it may be the same as notation 1 above for the said premium ie Solgold shares ? The direct interest in Cascabel may be dealt with in a more detailed calculation? Yesterday, 5 Sep 2018, Cornerstone has cancelled their said plan for the said spin-out co.
3) Guyana*s Solgold shares were sold at 26.59 British pence, said to value Solgold mkt cap at US$600m.
If, it were to follow the very recent M & A, it appears that could be in the US$1.4-1.5 billion region. That would mean a potential 67 British pence [please check calculation].
4) If the next step is to offer 20% premium to 26.59p, it means that would be 31.79 British pence.
5) Then, the offer to Solgold could be, in theory, 40-50% more which would take that up to 47.03 British pence [50% mark] ? [This range is from normal state of play starters from empirical].
6) As may be usual, the board of directors say NO as in the Orbis case for the 1st offer.
Then, it may be increased by 45%-50% and that would take it to 70 British pence [50% mark].
CALCULATIONS:
So, the above hypothesis shows that in the case of 67 British pence [US$1.5 billion potential bid] or the stepped out norm, it would come to 70 British pence.
NICHOLAS MATHER
He has said that they have corporate strategists which may be the investment bank who specialises in M & A.
HYPOTHESIS- The above
Whatever steps may next take place or NOT, the final critical factor will be the price?
Price = Value Attributed to the Cascabel project vs previous or current M & A prices.
Rushing off so please check as I have no time to edit.
Above posted with the proviso of: It appears, Potential, Theory & Hypothesis.
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