Thanks
We would consider it an OK, but not great, deal. KRR probably could have gotten more. But, with a part share deal, KRR shareholders still get to participate in future growth, and from a capital markets perspective large companies do get better valuations. It is a 10% premium, but mostly a merger of equals as opposed to a takeover. The spin-out company is interesting and may have good future potential. Market cap of the combined company will be close to $2B. There are lots of synergies and cost savings and exploration potential . Shareholders owning about 10% have indicated support for the deal. From a business perspective it makes sense. That being said, some shareholders no doubt will be disappointed. We think KRR had decent potential on its own and this we think should have been reflected in a higher premium, or a larger cash component. For now we would HOLD and see where the arbitrageurs take the two stocks.