If QGold take up the shortfall it moves them closer to the 90% compulsory acquisition level.
I wonder what price the law dictates they would need to pay once they reach 90%? If it’s the market price the law is a complete ass because QGold is the market and what an oppressive market it makes.
I really don’t even understand the rational of this guy. Sure he got the asset much cheaper than it’s worth through issuing valuations that grossly underestimated the project value and oppressing minority shareholders but the project doesn’t even have a DFS, the resource is a little deep so mining method is going to be a big question on the economics. QGold is now entirely lumped with the development risk of the project. I really hope they have miss calculated and it’s a complete failure and QGold gets stuck with the gold in the ground.
The sensible way to do it in my opinion is like everyone else. Keep it on the market, share the risks and the upside, keep the equity markets accessible to fund the DFS and possibly some development costs. I suppose Wallin will reap what he has sown. Eventually karma catches up with these types. Esh
SMC Price at posting:
34.0¢ Sentiment: None Disclosure: Held
