A couple of things mitigate against a buyout anytime soon. We all know that PQ won't sell cheap- for far more than the present sp. But a major would have a hard time justifying buying out a .07/share company for multiple dollars. It just won't happen. Most buyouts are for maybe 25-50% more than the current price. We're going to have to wait until the sp is much higher before a major would realistically pay what WEM is worth. The other problem, and one also associated with the justification of a fair price, is the lack of a 43-101- and not just a 43-101, but one with massive amounts of resources proven up. We should have a 43-101 soon, but the initial one won't have any proven resources- it will be primarily a summary of historical data and information and what is known about the geology. Proven resources (at least according to the 43-101 standard) won't be incorporated into the 43-101 until a significant amount of drilling is completed. A major that has in house expertise of course will be able to evaluate the historical data on their own and estimate resources, but if they need outside financing they won't get it without a 43-101.
It's true that there is the occasional exception to the above, but it's rare. Barrick bought Arequipa on the basis of maybe a couple hundred drill results (though this was before 43-101s) for $30 when Arequipa had never traded much above $2. But those drill results indicated huge resources. Maybe if SFMI can produce some phenomenal drill results that indicate that WEM can still produce prolifically at over 2.5 oz/ton, something may happen. But I think we still have a way to go before we get an offer that would be considered seriously. In the meantime, I do expect the sp to move up, maybe rapidly, as the expected developments occur.
