new rbs research

RBS has just released a massive 15 page research paper covering the TXN/SEA merger and TXN/TALON demerger.

I'll work out how to share it but in the mean time here are some extracts (all the usual disclaimers apply = not my work, unedited by me, DYOR etc etc):

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We see upside from the merger with SEA and interest in Talon and recommend shareholders of Texon to vote in favour of all resolutions in the absence of a superior offer.

The deal adds value
In our view the deal makes strategic sense. We value SEA on a post merger basis at $1.15 per share. On this basis,
the current share price of TXN does not reflect any value for Talon, and therefore buying TXN now gives
investors a free option in Talon, which we have valued at $0.10*/share. The share price of SEA is currently trading below our valuation post the merger ($1.15 per SEA share),
suggesting significant upside in the next 12 months.

* This valuation is based on the current issued capital pre the proposed capital reduction. Following
the 2 for 5 capital reduction this valuation would increase to $0.24 per share.

Implied TXN valuation $0.67 per share