The deal isn’t a question of “if” but “when.” This is purely a negotiation tactic, with both sides leveraging their positions for a better outcome. FS likely pushed for a higher price at the last minute following its strong December financial performance, which has significantly narrowed the gap with AEF—though I still estimate FS is around 70% of AEF MC's. Both companies posted outstanding quarterly results, adding complexity to the deal’s valuation. FS is being priced as a multiple of AEF’s financials, but with its strong performance over the past two quarters driving greater profitability, alongside AEF’s solid results, the price is back on the table for renegotiation. The longer AEF’s board delays, the less favourable the deal will become.
AEF Price at posting:
$5.75 Sentiment: Buy Disclosure: Held
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