The thing to consider is that GWR is a debt free company with a market cap and Enterprise Value of $200 mill right now.
FAS needs to fund this takeover and will be in debt to the tune of $200 mill plus probably.
So the new entity - post successful take over(god forbid) has to pay an interest bill of $16 mill per annum and the debt also means the Enterprise Value now becomes zero - a loss of $200 million in Enterprise value.
Do you know what the share price will become post takeover - look at Centro's shares for an idea !
To the GWR shareholders thinking of converting from GWR to FAS .. from success to certain failure .. please rethink.
At least wait for a cash offer for your GWR shares - as FAS's shares are just pieces of paper. And you dont want to be part of the inevitable share price plunge post takeover.
Dont be fooled.
GWR Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
