GREY:NWSKF - Post by User
Comment by
yungcashon Aug 15, 2011 11:45am
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Post# 18942613
RE: RE: RE: Recent trading pattern: $ 4 offer ?
RE: RE: RE: Recent trading pattern: $ 4 offer ?The potential Goldcorp bid is not as far-fetched as some might think. Remember Goldcorp bought Andean's Cerro Negro project for $3.6 billion when it had only 2.54mm oz. indicated gold resources. Goldcorp wasn't buying what Andean had found, but what they thought they were going to find.
Keep in mind that Ana Paula was Goldcorp's project before they sold it to NES in 2010. They drilled it in 2005 and they know the GGB well. So if it's such a good property, why did they sell it to Newstrike? Good question. I would suggest two reasons. 1. they had not hit the high grade breccia that really turns AP into a world class deposit. NES mgmt hit the breccia (hats off) and that's where the real buzz is generated in this story. 2. By selling the property, Goldcorp sold away exploration risk to a junior with a strong exploration team that knows the region best. Let that team drill and attempt to prove up ounces, and then buy them if they do. A few hundred million dollars for Goldcorp to get a fully drilled property handed to them right near Los Filos is not a steep price to pay for a company like that. They are a cash flow generating machine with gold prices where they are.
Also don't forget that as a part of the AP acquisition, NES issued 1.5mm shares to Goldcorp, at the time worth $600k (now worth $5mm). It's impossible to know if Goldcorp has sold the position (or increased it!) as they are not considered an insider for owning approx 1% of the shares o/s. Interesting nonetheless.
Regardless, the fact that we are having a takeover debate is great and means that most of the people on this board are probably sitting on some nice unrealized gains! Lukas Lundin will do what he does best and push for maximum value when NES is taken over. I wouldn't be surprised to see any major come in to buy NES as the GGB is a up and coming world class mining district. To me, Goldcorp makes the most sense, but it could be anyone (bidding war?!)
GLTA, yungcash