Yeah, I aslo don't know why it should take that long, but my hunch is MXL will delay delay delay the process as long as possible, and then pay $160m plus a bit if that's the judgment, and if it's more (like, $1 billion) MXL will try to do the deal in 18 months rather than pay $1 billion. Whether SIMO will agree to do the deal following a $1 billion judgment is the question, and I sort of doubt it, which will perhaps leave MXL facing bankruptcy.
By Q4 2024 it's not that hard to see SIMO with $15 per share in cash, $5 per share in EPS, and a share price around $85. At that point someone else will probably buy them for $120 per share, so why sell to the losers at MXL?
I find it hard to see how MXL's termination was a smarter idea than doing the deal. With the termination they may have to pay $1 billion, and not own SIMO. Anything outcome might happen, but that seems the most reasonable. I think MXL+SIMO with $3 billion of 8% debt would have a lousy balance sheet, but be able to continue as an ongoing entity. MXL with a bad judgement may not be able to continue.
I do wonder whether Singapore arbitration wants to answer the many questions that are (surprisingly) not yet determined (as far as I can tell) by mergers and acquisition law. "What exactly are damages from breach?" is a challenging question to answer, and I wonder whether Singapore arbitration wants to make up it's own opinion on what Cayman Island's law says on this topic (hint - it doesn't say much). |
