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My problem with VEC is that "it sounds too good to be true", and...

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pmd3nka

2,393 Posts.

13

02/11/18

12:56

Post #: 36367755
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Originally posted by Zestfulmocha: ↑

WAF added to the 'to investigate list (my god that list is getting long! )

Yes, the signing of Adidi-Kanga has taken a LOOOONG time, almost a year in fact, I guess you could say that deals of this magnitude and importance to DRC local authorities warrant such detailed planning? And there's a fair few parties involved ... nonetheless, it has taken a very long time and I've been holding (sometime trading in and out to avoid losses on retrace/accumulate) with growing confidence it will come off. Not sure if you've followed it recently, but a lot of boxes have been ticked including complete project funding through to DFS and decision to mine (on great terms IMO), I believe the delays were due to a lot of this being forced upon VEC as completion criteria in order to sign the deal, which to me indicates DRC pressure for this to be a serious play, not another land grab and flip? Anyway, well over $100m Aussie funding secured to get through acquisition, DFS, go to mine... and there's the $70m equipment on site and $450m spent by Anglo... $25m MC? The risk has always been the deal falls over but that gets less and less likely every update and IMO we are at the point of signing (been saying that for 6+ months, granted, haha). I like the Qtrly too, they have been pushing the other gold assets they have and some results actually due this month (or next month?) at the lab now anyway... so beaten MC but lots of news flow, assuming AK signed, let's see hey!

Anyway the point not to pump VEC I guess, the point I was going to make to make is that i'm really not sure what Jason's plans are for DRC gold, he holds 50m shares yes (#1 holder) and is most invested in VEC of all his plays, so this gives me confidence that he is going to create some value, whether it's a TO or go to mine, either is fine with me so long as the deposit is as good as they say it is. A part of me thinks he will take it all the way himself (well, with the appropriate help!) as he has very well entrenched himself in DRC, not just VEC but across the others, WFE/4CE as well, so it wouldn't surprise me if his aspirations were long term dominance in DRC, not short term flipping, which would explain the long range planning that appears to be taking place in the companies, VEC included, to become the market leader in the country.

So I guess it's an interesting space to watch - and similar for Aussie players as for the DRC players, but yes I suspect you are right about Anglo, and my understanding is they had two viable assets at the time and the reason they offloaded Adidi-Kanga was probably for a few reasons: uncertainty/risk appetite given DRC back then (which has IMO improved considerably, and with recent Chinese investment as well as a variety of very viable deposits emerging, should only continue to emerge as a less risky investment, however not without a few speed bumps I'm sure...), also I don't think they had the focus to pursue all assets at the time and there was (I think) some time frame issues with the AK mine and local authority, the usual stuff - do something with it or move on, it's not "free parking". Anyway I'm getting a bit too VEC rampy i'll leave it there lol, just sits at the core of my assessment of DRC and Gold I guess, always the optimist as I assume one would be after waiting for a play to come to fruition after so long... I could be horribly off the mark!

LYC - Had a further look and might consider making a play at it regardless of what happens with the macro market, I'm invested in too many 'high risk' growth ASX300 stocks in the SMSF right now, need to balance that out a bit as I took a hiding in October... APT, GXY, PLS, NAB, BPT....

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My problem with VEC is that "it sounds too good to be true", and you know the rest of the saying. Might well be biased against DRC, but worth a watch anyway. Good luck with it!

pmd3nka (not held)

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