GREY:OLEPF - Post by User
Comment by
minedtheprofit1on Sep 04, 2011 2:13am
263 Views
Post# 19010526
RE: chet's price
RE: chet's pricehis problem is ole is running out of funds to support the drilling, he will need to raise money somehow but his options are limited.
what's their burn rate?
ole can dilute down and do an offering say for another 10m shares at 1.00 - how happy will you guys be?
he can also go back to his partners and ask for more money then dilute ole shareholders below to 33.5%.
the partners can also say they want out and sell their 57% to someone with deeper pockets. but that doesn't really help ole shareholders since again only 43.5% of the project belongs to ole shareholders.
the problem for ole and its shareholders is the structure. ole itself only owns 43.5 of the project, if they owned the whole thing the market cap of the company would be between 325 to 375m.the market is pricing ole correctly since they only own 43.5. the price of gold doesn't even help ole since really all they have is an exploration project not a producing asset.
if ole owned the whole thing, ole can go back to market for more money to do more drilling, increase the resource, then to proven and probable and do a feasibility study.
perspective.