This is a terrible deal for NewGold shareholders. The company has a fair value of $39 here on Simply Wall St and I believe that to be conservative. The company is 73% undervalued, and the merger has no premium, as CDE stock price has wiped out the small premium for NGD shareholders.
I have been a precious metals investor for over 25 years and just about every time I have experienced one of my company holdings being bought with a stock exchange deal rather that straight cash, it has been an unmitigated disaster, as this will be should the transaction go through.
This deal is great for CDE, as the premium is non-existent for NewGold shareholders.
Absolutely no Synergies with the combined mines. No real de-risking for NGD shareholders, as the mines hold no risk at present.
I’m very disappointed with the board for approving this merger.
I am not voting for this merger, and neither should you.
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