given Spheria is disclosing >1mm shares as of 14th Apr, looking at the trading volumes, they must have already had an existing position (below the disclosable threshold) but looks like they added significantly since the deal was announced. again, more confirmatory evidence this $7 bid is just the opening salvo. it is entirely feasible they have kept buying.
as of this moment, 5.3% of the company's shares have traded hands north of $7 since the deal was announced. that, plus AG's blocking 20% stake, mean this deal is dead in the water unless it is raised, significantly.
what is a reasonable price? 4x EBITDA - well below basically all other listed comps (like Nippon Light Metal, UACJ in Japan; or STU.NZ in NZ) - and say $20-30mm for the NPV of the tax assets, and $35-40mm in adjusted net cash, all implies ~$10 a share. i still think thats a starting point. this is all based purely on a financial acquirer (ie no operational synergies, which would be significant if a strategic got involved)...
time is our friend here too fgiven the business continues to fire on all cyclinders and I think there's probably another earnings upgrade coming in the next 3-4mos meaning Allegro is better off playing to their name (moving fast, as it were) than dilly-dallying.
all we need now is a strategic to get involved and this could be the next TNK.
CAA Price at posting:
$7.85 Sentiment: Buy Disclosure: Held
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