By extending the bid, MIN is giving NWE shareholders a free option by keeping the 1,300 share swap in place as a backstop and allowing NWE shareholders to benefit from the upside leverage of a discovery at LD with downside cover (a put).
If LD fails, the offer will look more attractive. If it comes in, the NWE share price may decouple and trade at a premium to the share swap. This ratio has held firm for most of this higher offer.
If I'm right, MIN will not extend the bid much beyond mid-April, which is the likely first indication of gas in the well.
Let's see
AL
NWE Price at posting:
6.1¢ Sentiment: Buy Disclosure: Held
