Needs to hit 90%, currently sitting on about 85% shares, which moves to 86% allowing for 5% direct interest via Tranche 1.
Let's also look at Tranche 2...
Tranche 1 – GPR will spend up to A$0.65m in less than 6 months on due diligence, defining a work program and committing to proceed to Tranche 2. GPR will earn in a total of 5%.
• Tranche 2 – GPR can spend up to A$8m over 24 months to earn an extra 35% assuming it does not achieve the incentive target of 1.2Moz reserve. KGD will hold 60% including 5% for the PNG Government. Alternatively, if GPR define the 1.2Moz reserve they will earn an additional 46% to take the total to 51%.
So for those concerned about the takeover being completed, the 1.2 million reserve does not need to be defined for GPR to move to 40% once they have spent 8 million dollars.
Assuming the 8 million has been spent then that entitles GPR to 40% directly plus 85% of KGD's 60% share, that is, 40% plus 51% = 91%.
Defining the resource at 1.2m+ moves GPR to 51% plus 85% of KGD's 49%, that is 51% plus 41.65% = 92.65%
It all makes sense why GPR were content to stop the bidders statement at 85% allowing for Tranche 2.
I expect a serious rerating in Q1 2018 as a result of both the new reserve estimate release and the takeover completion.
I took the opportunity to top up this week at 2.5c and urge existing and prospective shareholders to DYOR and weigh up GPR while at this price level.
