Ann: Race Strategic Update August 2023, page-286

Price is set at the margins.

You don’t need to take my word for this, just go and look at the multiples that any of the dozens of companies on the ASX that are taken over every year are bought for. No buyers comes in and pays 10 times the MC for a company because that is what they think it is worth, they all make an offer at some price that is a relatively small fraction above the current SP and which they think enough of the shareholders will accept. If they are especially ruthless they will engage in a whole lot of dubious tactics to smash the SP beforehand or any of the dozens of other ways to get a better deal.

Occasionally you get lucky and a bidding war breaks out for one of your investments and you get a much higher price. I was lucky enough to be invested in Cardinal Resources when a bidding war broke out between the Chinese and Russians for control, but even in this case I only got 3x the initial SP in the end.