At this stage, I am a "Yes" for 45c for the following reasons:
1. 45c would result in a pretty good profit for me.
2. Not accepting 45c could drag things out longer, and we run the risk of losing funding or getting caught up in global economic troubles.
In saying that, if I vote No, apart No.2 above, what is the worst that can happen.
A. I am outvoted and have to accept 45c
B. No Vote wins and China/Hanlong crack it and they walk away completely (Unlikely)
C. No Vote wins and China/Hanlong revise their bid towards 57c which they have funding for (more likely than B.)
Whilst I am happy to take 45c and very much agree with everything that Baukaw says, I am just looking at the options above, and are starting to think that a No Vote could well be worth the risk.
In order for a No Vote to get approved, they only need 25% of the vote, so there is a real possibility of this happening.
In regards to the Board's recommendation, I believe they are caught in the middle. If they were to come out and say "Vote No" then it would damage the relationship and trust that they have with Hanlong, China and Cameroon, which could work against us. So they need to be seen as the good guys and as if they are fully co-operating, supporting and helping both Cameroon/China/Hanlong. If they didn't tell us to vote yes, they would be seen as trouble makers and the ones being and encouraging disruption. So in a classic case of Good Cop, Bad Cop, they are trying to be the Good Cop, and leaving it up to Shareholders to be the Bad Cop
Then we get to Hanlong. They have got funding for 57c, so they are obviously prepared to pay that price and maybe they were always anticipating a No Vote right from the start. So rather than Shareholders voting no to 57c and them having to up it to 65c. Us shareholders vote no to 45c and they end up upping it to 57c, which was the original amount.
At the beginning I thought that 45c was a moral, but now I am starting to see the real possibility of Hanlong upping their bid on a No Vote, even if there is no counter bid.
Is there something I am missing?
SDL Price at posting:
38.2¢ Sentiment: None Disclosure: Held
