Today shareholders voted on the fate of Sirius Minerals PLC, the company developing one of the largest infrastructure projects in the United Kingdom - The Woodsmith Mine in North Yorkshire.
In our opinion, the offer by Anglo American is derisory considering the capital already invested to develop the project to date, including that of small shareholders - the large part of which will be destroyed if the offer is accepted.
However, shareholders are damned if they do and potentially if they don’t, another offer may not be forthcoming from Anglo or another late comer to the party and the company could well then be picked up on the cheap through administration.
The British Government could be accused of shortsightedness in its failure to assist the company - in its current form and ownership - along the path to success, which would secure increased tax take from the company and shareholders, new jobs and increased support across the region, in the process providing perhaps just the statement required to prove the Government are genuinely serious about the fortunes of the North. However, is it right for the Government to intervene in the fortunes of private companies? it’s job is to set the right climate for business to trade, once this is done, ups and downs are just part of the business.
We operate in a capitalist ‘free market’ system and whether shareholders like it or not, the position the company finds itself in dictates that Anglo have the leverage on this occasion.
Some will win and some will loose, it just happens that those invested in Sirius are now on the loosing side of the deal.
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