Lihir Gold (LGL). Shares in the gold miner and its suitor Newcrest Mining have both fallen about 3% or slightly more. Ive previously said that Newcrest would only have to sweeten its offer by 510% to snare its target, but that could all change with the new resources tax. Lihirs assets are based offshore so the federal government cant touch the profits generated there; it would be up to the Papua New Guinea government to set up its own special tax and thereve been no signs of that. Unfortunately for Newcrest, most of its assets are based in Australia so Lihirs assets now look even more attractive because theyll generate proportionally better returns. So its easy to see why bumping up taxes at home can quickly ship money abroad. In this case, the Henry review could have added 57% to Lihirs value from Newcrests perspective. Euraka Report
LGL Price at posting:
$3.67 Sentiment: LT Buy Disclosure: Held
