We note with interest that PRE is buying PMG in an all-cash deal and to fund the buyout, PRE is raising large-scale debt (why PMG wasn’t interested in PRE paper is beyond me, not). To quote from the NR last night:
The total purchase price on a fully diluted basis, including assumed net debt, and excluding funding of ExploreCo, will be approximately Cdn. $1.6 billion . Financing of the acquisition will be accomplished by cash on hand and bank credit facilities including a committed U.S. $1.3 billion short term bank facility, which the Company expects to refinance after the acquisition is completed.
Just out of interest, we’d like to point out what can happen to Serafino Iacono companies in Colombia when they decide to fund their activities by taking on a heap of debt:
But in the case of PRE, it’s unlikely to happen. Right?