my guess is the chinese said we need to simplify the projects...

my guess is the chinese said we need to simplify the projects shareholder structre before they pull the trigger. also there would be some cost saving synergies at least at the corporate end. so a merger seems to make sense.

i assume this would be a scrip merger with pdy (4.2x bigger) issuing shares to agu, in which case the relative value becomes important.

before people get too carried away with todays trading, the 5 and 10 day VWAPs PRIOR TO THE ANNOUNCEMENT suggest it should be around 1.9 new PDY shares for every 1 AGU share.
[PDY 5day vwap = 1.45c; 10day vwap = 1.45c]
[AGU 5day vwap = 2.70c; 10day vwap = 2.77c]

sounds to me like any more than 2.0 new shares for every AGU would be a dud deal for PDY holders. lets remember that AGU is a small minority in the project so there is no control premium warranted.

if pdy agree to pay more it would be a clear sign to me that pdy exec are overpaying (via pdy dilution) for their own personal ambitions and to preserve their own positions.

from memory there is some cross holding between the two companies and certain sharholers in both companies; i presume none of them would be allowed to vote on the merger due to conflicts, which will make it interesting.

DYOR, interested in others thoughts and happy to be corrected on any facts above.