I think contributors will agree that the present situation vis a...

I think contributors will agree that the present situation vis a vis SKE and PRG is that they are holding talks with a view to a possible merger.
The big hurdles in such discussions are generally the price , who is the acquirer and who will be the CEO.
If as has been suggested PRG is the acquirer then it has to stump up with the consideration in some form - cash only ; cash and shares ; shares only. Assume the suggested price for a SKE share of $1.65, that means PRG is buying a $1.71 per SKE share of good will. How PRG overcomes that hurdle will be for its board. PRG has minimal debt at the moment, so a cash offer will need either borrowings by PRG or a later share issue or a combination of both.
Assume part of the consideration is say 80c cash per share. That would need say $180 Million in borrowings by PRG.
Assume the takeover/merger goes ahead, the new group would then start with over $400 Million in debt and a massive amount of "goodwill".
Is such an outcome good news for the possible merged group?