And thank-you for your response TBS.
So far as takeover talk, more important than anything else is who it is. For one reason or another, a combination with Pangang, or any similar-size such entity, would not be in our best interests (at least, in anything but the most distant future). Moreover, because of complications of one kind or another, it’s less likely to happen than a less dramatic takeover, which, incidentally would be far more beneficial to us anyway.
Take Champion for example (or, should I say, “Champion, take Fancamp for example?”). In such an example, a takeover through exchanging shares makes more sense than an unrealistic monetary buyout. Making it even better and easier and more sensible in regards to working it out with our partners at Champion, consider that they already own a sizable chunk of Fancamp. Just as good (if not better), Fancamp already owns a sizable chunk of Champion.
This is more realistic (and even better, in the long-run) than one of the Giant Santa Clauses of one of the deep regions of the World, such as China, suddenly being hit by a bolt of lightning, which wakes up and excites its brain cells to buy us out. So far as Champion, I cannot imagine they have not, for some good time, already been thinking such thoughts, without any prompting from us.
For starters, this year, CEO O’Keeffe bought bundles of his own shares, on the open market, for himself. In fact, it’s fair to say, he’s loaded up. I’m sure the thought has not escaped him that, as part of a share-exchange takeover, the Champion shares expensed would be reduced by the Champion shares already in Fancamp’s hands.
Moreover, the boardroom at Champion is possibly the one-and-only of the rarest-of-rare corners of the globe that follows the fortunes and misfortunes of Fancamp. Reinforcing and binding our connection, Champion is represented on our board of directors as we are represented on theirs.
The knee jerk reaction to a Champion/Fancamp combination likely would be the obvious outcry against the simple mathematics that the mineral holdings of the Fancamp Shareholders would be diluted by the Champion side of the equation. That’s true. But, given such a deal, nonetheless, I would favor it anyway. My sentiment is that we’ve suffered the illiquidity of our shares for far too long already. Without any further delay, we need to find ways to put an end to it. Combining with an entity of Champion’s size will help considerably in that respect.
At the same time, the dilution would not be insufferable. Think of a bathtub full of 100% alcohol. If you drained three-quarters of it down the drain and replaced the lost liquid with water; that would still leave you with the makings of a potentially-potent long-lasting supply of beverage. Day-after-day, before going to work, drinking a few cups of the new 25% brew would still be enough to take you away from the cares of the world.
