If they agree on a deal my guess the ratio is 1 TPD share gets 0.55 STX shares.
Because the original proposal excluded Mongolia I removed this from the current TPD share price using TMK.
TMK for 67% of Mongolia = 80M market cap.
TPD for 33% = 40M market cap.
TPD current market cap = 120M less Mongolia above (40M) = 80M TPD market cap without Mongolia.
In SP terms, based on a 19c close a 80M market cap equates to 12.67cps being TPD's current share price without Mongolia.
Then based on potential agreed share ratio's between STX and TPD I looked at what the associated return would be based on TPD minus Mongolia.
I would think it would need to be above 30% return as a starting point so beyond 0.5:1 at an absolute minimum for any sort of takeover premium.
My guess of 0.55:1 is equivalent to a 43% uplift on the non-mongolia part of the business.
See table below based on STX current SP of 0.445cps:
Ratio
TPD
TPD less Gurvantees
Return on TPD adj
1 0.4270
0.1900
0.1267
0
2 0.4586
0.2041
0.1407
11%
3 0.4750
0.2114
0.1480
17%
4 0.5000
0.2225
0.1592
26%
5 0.5250
0.2336
0.1703
34%
6 0.5500
0.2448
0.1814
43%
7 0.5750
0.2559
0.1925
52%
8 0.6000
0.2670
0.2037
61%
9 0.6250
0.2781
0.2148
70%
10 0.6500
0.2893
0.2259
78%
There are likely many considerations I have not taken into account ie performance rights diluting TPD (the main reason a deal will be reached) and assumes a return on the $9M so just a bit of fun.
Let's see what Monday brings.
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