PLS to acquire 100pc of LRS to add 20pc to its mineral resource. That’s good news for LRS holders being given an exit plan and with ‘burden’ now placed on PLS management to get the outfit into production, but with a full share scrip acquisition, not exactly all that great news IMO for LRS holders opting not to sell and take up the share. Market does not like PLS move, as this is dilution, and potentially adds risk to PLS including use of its cash and potential CR further down the road. History will judge PLS move as I had mentioned before that management often needs to do something to show they’re doing something, many times to their own detriment. PLS may think that their timing could be impeccable for an opportunistic acquisition, but what they’re doing is opposite of ALB.
It also put paid to LTR hodlers hopes of seeing a merger with PLS.
M&A transactions at this point provide ‘undervalued’ outcomes for the acquisition target holders relative to the price they could have sold awhile back but which they didn’t because they wanted to be long term holders.
