My guess before was that RMS would offer scrip for scrip, prior to RMS on trading halt.
But given they are raising cash now and the quickest way in doing that is a under 15% of issued shares placement to sophiscated investors via a broker.
So under 15% of total shares placement would probably give them about $45m extra. Add in their current cash reserves say $86m (cos volume in DRM in past well may suggest RMS buying).
That would be around $130m, so I don't think RMS will do a a full cash offer. I think the likely chance is they will do a part-cash part-scrip offer.
Like I said before as the two boards probably met on last weekend, RMS probably wanted to see what the DRM board would accept in an event of a takeover. So DRM board approval of the deal is very critical for RMS success as the board holds 17% and approval will make the takeover friendly. So a part cash part scrip offer would have done the trick, my guess is offer price could be $1.85 to $1.95.
Given the volume since the last notice of change of interest, if RMS bought around 60-70% of total volume, that would mean RMS could be now holding just under 10% (likely around 8.5% to low 9%). What must of been frustrating to RMS was the past 2 days lack of sellers, no one in DRM really wants to sell. So today's volume explains RMS buying again, competing against people who saw the trading halt announcement for RMS capital raising. I don't think RMS will buy on-market any higher level. Otherwise the final offer price will have to be higher.
I'm sure RMS is very keen for DRM atm, cos they probably want a deal before DRM announces a JORC Resource upgrade, for sure it will be a over $2 stock with tripling the resource base.
I am a former RMS holder (sold at $1.64), current DRM holder.
DRM Price at posting:
$1.56 Sentiment: Buy Disclosure: Held