Q: Good morning team,
I am a shareholder of Argonaut and most likely vote in favour of Alamos gold offer ,looking at the long term benefits with this acquisition.However I am perplexed by the price movement of AR ,which is over the offer price of .40 by Alamos.Would you kindly shed some light on this situation as a possible technical trade!
Many thanks,
Jean
I am a shareholder of Argonaut and most likely vote in favour of Alamos gold offer ,looking at the long term benefits with this acquisition.However I am perplexed by the price movement of AR ,which is over the offer price of .40 by Alamos.Would you kindly shed some light on this situation as a possible technical trade!
Many thanks,
Jean
5i Research Answer:
As part of the takeover, AR's assets in the US/Mexico will be spun out to shareholders. These include the Florida Canyon mine and other assets in Mexico. Each AR share will get 1 spinco share and 0.0185 Alamos share. Since the spinout shares do not yet trade, the difference represents the attributed value shareholders are giving to the new spin out company they will receive as part of the deal.