Hi Guys, You can certainly see which shareholders were the ST...

Hi Guys,

You can certainly see which shareholders were the ST winners from this transaction:




I guess investors are taking the same view as me in thinking is an undeveloped deposit (with all the risks of that) worth the same as:

(1) 3 x producing mines (Waihi, McCrae's and Didipo)
(2) 370k oz of gold production p.a. at combined lowest quartile AISC
(3) 25kt of copper production
(4) Exploration upside in both countries

I have not analysed Romarco sufficiently to work out whether the value of Romarco = OGC at this point in time (i.e. OGC shareholders will have 51% of combined group ... really a 'merger of equals').

What you can say though is that even at a 72% premium to Romarco's closing price OGC may have waited til the optimal point in the cycle (are we at a bottom yet?) to undertake a predatory transaction:



If we are not at the bottom of the cycle the combined group, more so than OGC already was, will be well positioned to ride out the downturn with such a low AISC - purportedly being the lowest cost producer in the world by 2017 ...

If you weren't already an OGC shareholder (and my commiserations if you were) this may be attractive - exposure to the upside of the cycle with reduced downside relative to it's fellow miners due to lowest cost of production.

The other lesson is that the shareholders of prey companies get immediate benefit from these transactions. I certainly own a few goldies that I wish were taken over !!!

Cheers
John