RE:This is nothing short of a disgrace!Well where do I start Shy1?
1. I am one of the most accesible CEO's in the gold business. My direct office line is on every press release and I speak with shareholders daily. My email is also posted and I do open townhall meetings on a regular basis and post on message boards. I have been a bit quiet lately and now you know why.
2. Jerry and I will both be joining GROY as consultants and I will join the board. We will continue to generate and purchase royalties through our Nevada connections. Except now we will have the capital to do the deals we couldn't afford. Business as usual, no "sell out".
3. At $1.46, this transaction values Ely Gold at $295MM. That is 1.5 times NAV. Last week we were trading at .88 times NAV. Royaties are trading these days at 1.5-2 times NAV for royalties that are inferior to ours. So, let's say we wanted to purchase a $20MM royalty. We would have to dilute shareholders by raising equity and we would be diluting our assets in the process. It is getting very difficult to compete with other royalty companies that are trading at 2X NAV or juniors that don't care about diluting their NAV by overpaying for royalties.
4. The $295MM valuation is greater than GROY's at $235MM. Thus the cash component of $.42 to make GROY the surviving entity and yes, the listing and the GDXJ inclusion is important. Plus, taking some cash off the table is never a bad idea. So "da big boyz" are't stealing anything.
5. Management at GROY is very seasoned. David Garofalo was CEO of Goldcorp and led the largest merger in gold mining history with Newmont. Ian Telfer started Wheaton Precious Metals when he was at Goldcorp. Top to bottom, this is a very capable, experience and respected team in all mining circles.
6. Ely Gold has great retail shareholders that have helped us build this company. And we have Eric Sprott. What don't have is many institutional shareholders. GROY has those institutions and a completely different group of retail. They just completed a very successful IPO in February/March during the worst of the gold market. (Ely stock was $.85). They had to increase the IPO twice due to demand, from $30MM to $90MM. So someone out there likes their long-term assets and Management. So on the "NYSE Show", I will be presenting our assets to institutional shareholders, who support this management, for the first time.
7. The largest assets underlying GROY royalties are in Alaska, Idaho, Brazil and Columbia. Hardly the sketchiest of places. In order to grow our business, Ely Gold was going to have to expand jurisdicttions. I am on record that we were looking at Brazil and feel it has the most near-term potential for royalty opportunities. GROY has 4 assets in Brazil and great in-country infrastructure.
8. Yes, their assets are longer-term. But, they are now being advanced at a rapid pace. Alastair Still (Newmont, Goldcorp, Kinross, Placer Dome Agnico Eagle) was brought in as CEO of GoldMining Inc, owner of the underlying properties, in March. He has already updated two resouces, initiated two PEA's with two more updates due next month. Look for GROY assets to be sold or JVed under Alastair. Alastair is also VP Technical Services at GROY. While longer-term, these assets are very well endowed with gold and copper.
9. The real story with this transaction is the consolidation of the royalty space. There are too many juniors and not enough good royalties. The majors are now swimming in the "baby pool" for deal flow. The music has started and Ely chose to take the first chair with a company comlimentary to us on every level. Given the state of the market, more junior royalty companies will be acquired and we will be ready.
For all the above reasons, I respectfully ask for all shareholders to support this transaction.
And tune in Friday at 11AM EDT for our Townhall:
https://www.bigmarker.com/ftmig1/Ely-Gold-Royalties-June-Town-Hall?utm_bmcr_source=ELY Trey Wasser, President & CEO
972-803-3087