Hi Folks
I am sending the following please explain letter to the Board of PGO. I do not know if this covers all of the issues but it sums up how we are feeling right now.
cheers
ece
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Dear Chair of the Primary Gold Board
As investors in Primary Gold since 2015 my wife and I are both very disappointed with the Nanking share buyout offer at 0.0575c. There has been strong downward pressure on the share price for 12 months now and it appears there was little public effort to secure the final Coolgardie Toll treatment deal or begin to generate some positive news and cash flow.
We remain very concerned that the Board has recommended acceptance of a share value which is ridiculously short of share price targets found in Brokers’ research reports. Pattersons for example was suggesting a price target of 39.00 cps in 12 months back in August 2016 and that was prior to the Coolgardie acquisitions.
We also remain concerned that a takeover offer came from a company with clear links to one of PGO’s non-executive directors, and we would be keen to hear that it was done with appropriate declarations of conflict of interest, and in the best interests of all shareholders and not just the majority shareholder.
Further, we would appreciate information on-
- how the Board arrived at their fair valuation of our business at 0.0575 cps, and
- what steps the Board took to secure an Independent valuation
- any assurances you would be prepared to give us that all key requirements of the Corporations Act were adhered to during the Board’s consideration of the offer
- whether the final sign off on the toll treatment contract was withheld pending this takeover offer (which had the effect of continuing to suppress the share price)
- whether the Board has any information on the aggressive selling from one of the Top 20 holders which similarly had the effect of suppressing the share price and thereby assisting those interests behind the takeover offer
We make no claims or insinuations by asking these questions. We do not have all the facts before us just the obvious disjunction between a strong plan for growth, increasing JORC resources, a valuable cash for drilling deal plus clear potential for a substantial share price increase versus a modest even miserly takeover price that comes off the lowest share price in almost two years.
Yours etc
