Update on Merger with Polymetals - Notice of Meeting

Control Premium
The concept of a premium for control reflects the additional value that is attached to a controlling
interest. We have reviewed the announced control premiums paid by acquirers of gold mining companies
listed on the ASX since 2006. We have summarised our findings below:
Year
Number of
Transactions
Average Deal Value
(A$m)
Average Control
Premium (%)
2012 9 247.99 34.03
2011 8 1,119.33 22.56
2010 10 1,364.83 56.11
2009 13 128.61 21.39
2008 3 446.27 28.54
2007 10 191.36 29.36
2006 9 62.96 12.99
Median 247.99 28.54
Mean 508.76 29.28
Source: BDO Analysis and Bloomberg
In arriving at an appropriate control premium to apply we note that observed control premiums can vary
due to the:
• Nature and magnitude of non-operating assets;
• Nature and magnitude of discretionary expenses;
• Perceived quality of existing management;
• Nature and magnitude of business opportunities not currently being exploited;
• Ability to integrate the acquiree into the acquirer’s business;
• Level of pre-announcement speculation of the transaction;
• Level of liquidity in the trade of the acquiree’s securities.
Taking the factors above into consideration in a applying a control premium to SXG’s quoted market share
price we believe an appropriate range to be 25% - 35%, with a midpoint value of 30%.
Low Preferred High
Quoted market prices $0.026 $0.032 $0.038
Control premium 25% 30% 35%
Quoted market price including a premium for control $0.033 $0.042 $0.051
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