Agree 100% Pinata. It has future upside and we are being low-balled in the offer. EV/EBITDA ratio around 6.5 and a very low premium for control. The independent expert's report refers to EV/EBITDA ratios in public company acquisitions of mostly smaller private companies, (which are always going to be lower), as justification for this low multiple. It should be more like 8 imo. If the transaction does not proceed I would expect dividends this year of around 1.75c which is 4.8% fully franked return on the 36.5c being offered. With FY19 NPAT forecast at $7.3m the P/E at 36.5c is only 10.8. There is plenty of upside in this company.
LGD Price at posting:
36.0¢ Sentiment: Hold Disclosure: Held
