"PAA is reportedly proposing consideration of 0.435 common units of PAA for each issued and outstanding publicly held PNG common unit in a transaction that would be structured as a merger of PNG with a wholly owned subsidiary of PAA. The proposed consideration represents a value per PNG common unit of $22.74 based on the trailing 10-day average closing price of PAA's common units through August 26th."
Maybe I am reading it wrong but, that works to $22.74 and fixed.
There are two ways a buy a company. Give them your company stock or give them cash (or a combination of the two). This proposal is an all stock/unit deal. The $22.74 is PR fluff. Run thru some scenarios of pretend trades. I will become clearer. Remember, you are buying PNG, converting it to PAA units, and then selling PAA for the going rate. PNG unit holders are not receiving any money directly from PAA.
You are mistaken. The offer is for 0.435 common units of PAA for each PNG unit. So it is fixed to the PAA stock price. So based on Friday's PAA closing price of $50.47, PNG offer is worth $21.95. So if your on the sideline, you might want to buy PAA instead of PNG since PNG closed at $22.39.