My thoughts db are this:
I've spent the last 24 hours trying to digest the proposed buy-out. Frankly, to some degree, I am still on the fence about certain aspects of it. But what I do know is this.
1. Selling now makes absolutely no sense at all. Why would anybody sell at anything below the buy-out price?
2. Planet 13 and NGW appear to have very common goals and it appears to be symbiotic relationship. Together they will attain their common goals much quicker than either could individually.
3. The past year has been brutal on the entire sector. Every single company in the sector has had their legs cut out from underneath them. I believe this will change eventually. Like ANY sector, those who are profitable will eventually rise to the top. Those who are not will die. That's a cold - hard fact of life. NGW is insanely profitable. Planet 13 is not, but neither are they losing huge sums of money. The acquisition of NGW will get them to profitability sooner than would be the case otherwise.
4. Consolidation in the sector is inevitable. I liken it to the automobile industry of the 1920's and 30's. At that time there were just way too many manufacturers all competing for market share. Within a twenty year period, that number had been reduced to the big three here in the USA. It was good for the industry.
Do I think they buy-out price is fair? It doesn't much matter does it? Of course I had hoped for a more favorable number but that's always the case. It's a moot point unless shareholders nix the deal come February.
To me, there is no doubt that the new combined companies will be much stronger together. P13 desperately needs a bigger footprint in California. NGW needed the retail outlets. So, instantly we will have an impact and be in a position which would have taken us many years to attain on our own.
There's always things about any deal that each side wishes were different. Right now, P13 shareholders are lamenting the dilution of shares. NGW shareholders are saying the deal was too cheap for our side.
A year from now, with favorable market sentiment and with the mutually beneficial impact from the merger, P13 could be a $10.00 stock.
What am I doing? I am sitting tight. The deal doesn't contain everything I would have hoped for, but I think there's way more good than bad............for both sides. Isn't that the very definition of a win - win deal?
