I think downer overpaid by about $500m, if you look at that on a diluted per share basis, its probably about 0.80 per share.
Downer is looking at an ex-rights price of $7, subtract the $0.80 from paying too much and we get a $6.20, which could be a theoretical ceiling price. Its reported that the rights issue is struggling at $6 which further supports that.
I think in practice the share price should go below $6.20 due to increased risk of debt, integrations issues, risks internal to spotless, and damage done to the reputation of downer managment.
I think at a bit of guess $5 could happen within months, still not sure im willing to put money on it and short it though...
DOW Price at posting:
$7.42 Sentiment: Sell Disclosure: Not Held
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