When the Joint venture was signed, a lot of posters were saying this was a win-win-win for everyone involved. Crystallex would stay under the radar and get the permit & mine financed. China would get access to one of the worlds largest gold deposits with 2/3 of the mine, and venezuela would finally get this mine going, and get to tell everyone they got rid of the gringo's.
Well, as my investment return to date shows, i don't see much winning for me, China, or even venezuela. So what gives? Is this country really that backwards and stupid?
But I guess the game isn't over yet. Maybe this will still be a big win for China, as before, but with 49% instead of 66% before. Venezuela will get the 51% JV set up they seem to want, but not officially, wink, wink. meaning they also win.
And as for Crystallex........... well, our win could come in the form of an easy arbitration case with payment in 3 years time. And in the meantime, China can buy our equipment and data for $140 million, heck, we don't need it any more. And its not like they're stabbing venezuela in the back, its just business, they could really use that stuff. With this money we can then pay off our noteholders, and have money to finance the arbitration, and in the process, keep the current number of shares outstanding. Even with an arbitration win in the 600 million range (which is the least we should get), we're looking at about $1.50 a share.
Now, ur prob asking, but an arbitration win for us, is a loss to venezuela, no? Well, not really, i mean, they get to make their sugar daddy(china) happy, they kicked us out (like Chavez said he would), mining got going anyway, and they are now a majority JV holder of Las Cristinas ( and Brisas?). Plus, its not like Chavez is paying out of his pocket anyway. He may even be gone by the time the first gold bar is poured, but that doesn't matter, he got his loans and padded his account already. its venezuela's problem after.
Yup, got me a pair of rose coloured glasses too.
But anyway, back to reality. I can understand why the noteholders prob won't make a fuss until the fall anyway. I mean, if you can still get another payment on your notes, why not take it, ur gonna be in the same position in 6 months anyway. hopefully by then, our share price will be higher, so if we have to do a dilutive conversion of shares for debt, the number will be a lot lower. or maybe, aftger selling our equipment, we can try to buy back our own debt on the open market.
Or, the chinese can buy us out. Wouldn't that be nice. Fingers crossed.
This story isn't over yet, but I guess it can't really get too much worse. I'm holding until the end.
FK.
