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First Majestic Silver (AG) -5.7% premarket after last night's news it is acquiring Orko Silver...

First Majestic Silver (AG) -5.7% premarket after last night's news it is acquiring Orko Silver (OKOFF.PK) in a friendly deal. The all-stock offer implies a value of C$2.72/share, representing a ~69% premium to Orko's volume-weighted average price for the past 30 days.
Comments (7)
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    Fantastic deal for AG.
    17 Dec 2012, 08:44 AM Reply Like
  • Michael Bryant
    , contributor
    Comments (5182) | Send Message
     
    Time to buy (AG), but I would like it to fall below $20.
    17 Dec 2012, 09:53 AM Reply Like
  • MoreBob
    , contributor
    Comments (48) | Send Message
     
    Why did AG fall in price when buying Orko is such a good deal? Did the "smart boys" and/or traders put in sell orders believing that the AG price would rise on the announcement? The trading volume today was very high.
    17 Dec 2012, 09:48 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5182) | Send Message
     
    Always happens. When a company buys another large company, equity goes down while the purchased company becomes integrated. Same happened when (CF) bought Terra Industries years ago. Takes about 6-12 months to fully integrate. And isn't that what happened to (AG) when it bought Silvermex? It could fall further, but once the acquisition is integrated, it will soar.
    17 Dec 2012, 10:18 PM Reply Like
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    They used their stock to purchase Orko which is dilutive when you consider it against current earnings.

     

    If you look at it in a reserve and resource calculation it is more positive.

     

    This is a very good acquisition as First Majestic added one of the top undeveloped silver projects in the world.

     

    You have to credit management for snapping up two valuable assets this year in Silvermex and Orko.
    18 Dec 2012, 12:49 PM Reply Like
  • TomFlagg
    , contributor
    Comment (1) | Send Message
     
    Who could buy AG? SLW? They are already AG's largest single investor. I think they are doing just fine.
    18 Dec 2012, 01:58 AM Reply Like
  • MoreBob
    , contributor
    Comments (48) | Send Message
     
    Thanks M. Bryant and D. Urban. You have given me more to think about.
    18 Dec 2012, 06:43 PM Reply Like
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