Well we can agree that we have a difference of opinion! :) A...

Well we can agree that we have a difference of opinion! :)

A couple of points:

1. Again, I strongly disagree that this is management 'looking after themselves'. (refer comments regarding TG's shareholding above). This statement is just purely unjustified on the basis of fact and logic.

2. "The market agrees by selling off"... to exactly the price where the company was sitting prior to the announcement of the sale negotitations - so what's you point? Once the cash is received the share price will likely drift towards the cash backing (maybe not 100% dollar for dollar - but it wont trade at a 50% discount either). The current weakness in my view reflects the uncertainty in the offer and the significant risk associated with ENAMCO/China Inc actually paying up.

3. The market cap immediately preceding the announcement was similar to the current - circa $65M. Paying $80-100M for a 60% stake in the main project is already a significant premium, but if you take out cash and ENAMCO proceeds (so non cash value of $30M attributed to all assets), then the premium paid for the Koka stake is 300%. One can argue the the ENAMCO cash isn't guaranteed, but there's still plenty of margin here.

4. It's a mighty supposition to say what every insto investor would prefer, but I'll leave that. The other mighty supposition is that you have assumed that a takeover was actually on offer which is something that you are stating with no basis (more on this later). Beyond that, most insto's are notoriously short sighted, so I agree that they probably would prefer a short term cash takeover (which I wouldn't necessarily be opposed to - at the right price), but is that really a sound basis upon which to frame your investment decisions?

5. I come back to the point made in the post above, which is that management can only 'play the cards' that are dealt. They determined not to proceed with the project development (for whatever reason), and have now determined that the sale of the asset represents the best offer that is ACTUALLY on the table. You are assuming that management have not solicited/ pursued a 'whole of company' takeover (I don't know either of course, but you cant assume 100% one way or the other).

6. There is nothing at all stopping China Inc (or any other 'company') from making a takeover offer (friendly or otherwise) That they haven't done so surely says something in itself.

I'll leave it there! Each to their own - but there are two sides to every coin and most of the recent commentary has been predicated on assumptions that are debatable at best and malicious at worst.