Terrible shareholder outcome AP. Demerger meant to be only the backup option to increase bargaining position against potential buyers. It's not only expensive to go public, but the implied valuation of the spinoff is much lower than the sale price should have been.
I did some very rudimentary math to understand the market cap of the demerged company. The spinoff will be essentially 1/9th of the current market cap of RXL, which is c.a. $10 mil on the current valuation. They should have just kept the nickel assets, because it's peanuts!
The calcs:
48% of the shares will be given pro rata to current shareholders and 1 new share will be distributed after each 4.3 shares RXL shares. 4.3x(1/0.48)*$94m.
It looks like RXL will also reduce the number of shares on issue from 2.3 billion to 157.6 million on 27 May 2021. After the stock merge, the new SP would be around 57c. Unlike the demerger, getting rid of the pennystock status is actually a good move imo.
All my opinion, feel free to correct me if I am wrong with something.
Ann: Rox to Demerge Nickel and Base Metal Assets, page-28
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Last
12.5¢ |
Change
0.000(0.00%) |
Mkt cap ! $51.32M | |||
| Open | High | Low | Value | Volume |
| 13.0¢ | 13.3¢ | 12.5¢ | $162.7K | 1.252M |
Buyers (Bids)
| No. | Vol. | Price($) |
|---|---|---|
| 8 | 265704 | 12.5¢ |
Sellers (Offers)
| Price($) | Vol. | No. |
|---|---|---|
| 13.0¢ | 292348 | 2 |
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