How motivated do you think AVL/RCF are to get this merger over the line first try?
I think they 100% need this to happen now. And have played it cool so far, but what is their strategy when this gets serious?
They have received the feedback at this point that a block is a very credible outcome now.. So what are their next steps?
I assume right now they are just awaiting the scheme booklet to come out.
They'll be hoping the content sways some votes at least, and they'll probably be able to talk more openly after it's out to further convince TMT holders.
I think the main picture that they'll try to paint for us will be:
1. The carrot -This will be funding... "No one is getting funding if there is no merger... if we merge, there might already be parties circling to provide funding (whether that second part is true or not, I bet they all but allude to it to tempt us all).
2. And the stick - This will be our shareprice tanking if we block this merge.
My view though is that they want this deal done, and want it done now, so they will need to take this negotiation seriously at some point.
Graham is still out there promising AVL holders that construction is on track for 2024. That lot may continue to believe this, citing "major project status" and 'fast tracking', but if we picture 2024 with a blocked merger, how long do AVL holders keep buying this? What are they paying a few $mil in corporate costs for next year if it's not to integrate the two companies?
Then we can picture TMT's 2024. You imagine EPA permitting is complete in the first quarter. Reserve update you would also expect first quarter. Who knows if work was continued on the financial model that factored in the early works that we picked contractors for, or if the merger stopped that activity, but a block I would assume has TMT needing to push again to release that.
My opinion is post block, we might see some share price pain, I can acknowledge that, but looking ahead at 2024, as a TMT holder I am not afraid one bit of what that looks like for us.
AVL on the other hand need TMT's EPA advancement to have any hope of drlivering on their promises to holders, or at minimum the combined revised DFS work, which bails them out of, as I said the other day, every bad decision and timeline promise they have made in error.
So they should be extremely worried about 2024 without TMT, and extremely motivated to get this deal done..
TMT can wait for the offer they want in my opinion.
I wish Ian was in a position to fight harder for that, but as owners of the company, we can do it for ourselves.
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