Resolute to sell Ravenswood, page-16

28/11/18

00:19

Post #: 36662055

@Fangk

as i said earlier - there's long been ta;l about london being a deeper pool of capital support for african golds.  but the hard reality is that share prices there have never shown any long term sustained premia vs asx golds vs tsx

the reality is that each market tends to be priced  prevailing valuation trends that drive sp for 2-3 years then it shifts. 

for example tsx way outperformed asx gold for a lot of the 90s.  in past 2-3 years asx gold have outperformed vs elsewhere - because everyone assumed aud would fall from 90c to somewhere between 75-55c depending on their baggage. 

its driven generally by either a currency tax or domicile/risk view - and global money all moves to the same area baed on the same view of whatever is seen as driving better profits/pes - european money is a big part of asx goldies recent strong performance for eg

the other big truth is that most gold funds execute globally.  nearly all big gold funds cover at least lse, asx and tsx

any competent gold mining exec is aware of this - so they generally are using it as cover to make a move they want to undertake for other reasons

in rsg;s case i;d bet pounds to pennies that its a precautionary move to be able to tap capital from fresh/unjaded investors if syama requires it

frankly Singapore is such a hub of European gold money now via family offices -anyone with a strong gold story suited to those investors would be able to get good support here

by the time a dual listing is set up its common for the premia valuation driver to have disappeared - because it takes so long to undertake and then get the new market familiar with the stock

the thing you should also expect from thuis is that ravenswood will be sold.  though theyll deny it until its announced.  but european investors will view it as a distraction and a weight on valuation

probably wont happen for a fair time though - theyll want it in the listing to maintain the 500koz storyline

personally i find this move disappointing because it shows no regard for australian long term holders - who dont want UK listing times and esp dont want to lose asx listing. 

but sometimes the fact is that a market is cold for so long its  impossible to reheat - and rsg is starting to get that odour

i think this is a story its becoming better to ignore - regardless of what it will look like in 1-3 years - its still not cheap - and its going to have all kinds of liquidity and compliance bs

but  it may offer a bargain buy at some point that makes all the hassles worth it.