Firstly on "fiduciary obligations" I am not a lawyer and not sure the use of these words was wise in the announcement. However it is clear that the PPX Board's primary obligations are to the PPX shareholders with any obligations re the hybrids subject to the terms under which they were issued. I am sure they would have sought legal advice before stating this.
>Clearly, Price is going to need to give up control to PXUPA holders if he wants to do a deal.
Not necessarily if existing shareholders are given the opportunity to contribute new capital. That is why I have been suggesting a rights issue as part of the deal. There is no reason the rights issue could not immediately precede a share swap with PXUPAs provided PXUPA holders were fully aware of the terms and agreeable.
A cornerstone investor would be required but they could be supportive of the Board. My view is that an opportunistic investor that tried to squeeze the interests of PPX shareholders would not be welcome unless things got desperate.
SRS Price at posting:
5.2¢ Sentiment: Hold Disclosure: Held
