“The bottom line is that we have an offer that appears will not be challenged. Its not any near as bad as an RR or Trelawney offer. Its not the $10+ we all wanted. Its not terrible. And the reality is...Its done.” Probeguy
Some win and some lose. You win, I lose on this one.
I decided last spring because of the Macro Gold Market manipulation to sell most of my Probe, after originally purchasing in 2009. Thought I could be rewarded better in a stock called ZEN (dyodd) which was outside the gold market, had serious potential and imo much Buy-out Potential. Always, thought PRB was top of class and would be bought out, just not this early after the new land acquisitions. My plan to re-enter was thwarted by this surprise offer.
I was surprised by Dave and Board, accepting the G First Offer. IMO the offer was low, though by official resources is $110/oz. The 4.3 Moz is pit-constrained with the 2M high grade. Actually, the resource of the low grade pit and underground is more like 6.3 Moz based on higher gold prices and plus the exploration potential of new lands Borden could easily be 10 Moz. At 10 Moz the deal $53/oz, better than our $12/oz valuation in 2013.
Plus, we’ll never know the behind the scenes stuff, even discussions of costs to drill the new lands, capex to build a mine, dilution over time to get to production in 3 years and the gold market forces, which are still unclear of a new trend even though recently trending higher. In a NY minute, POG can be whacked just like the last rally in March and the one before that.
Very surprised to see AEM fold and not fight for this new Gold district, especially, with the long PRB/AEM history of working together, going way back pre- Goldex being built and PRB retaining a royalty interest as WB and Father, past President Probe clearly indicated. I was looking to buy back Probe for this White Knight but now seems to be a done deal. I guess Osisko was a big pill to swallow and AEM was happy with these investment returns.
As to looking at further investment. IMO, the macro POG is still unclear if this lastest rally has legs ($1350 would be good, and breaking $1400 would be convincing) Besides PRB, always liked the “Valley of the Kings” project of PVG, wanted to buy-in around $5 last fall but has ran to almost $9 which is getting rich. Also like PG and KAM.
My biggest holding is now ZEN as previously stated, which disappointed big time by x2 PEA Delays, no Buy-out with the 20+ NDA’s and market value declined by 50% from Junes first delay. I would recommend this, dyodd but here are some numbers from myself and other influential posters at AG ZEN Board based on $8500/t. (ZEN has Synthetic-like Natural Graphite where the highest purity sells for premium prices up to $30,000/t and ranges 7-30k)
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Mcap is $90M at SP $1.50, 60M shares f/d
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Deposit Value $12B In-Situ at $8500/t,
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NPV $2.4B at 8% discount and IRR 104% (PEA imminent)
Graphite is not Gold, and is a strange, secretive market on pricing, as prices are not quoted like Gold, Silver, the other Base Metals and more importantly all graphite is not created equally.
Good Luck to all, no matter where you invest, Cheers, Mark
