OTCQB:AQARF - Post by User
Post by
goldpigon Jan 13, 2010 8:32am
344 Views
Post# 16672336
Upside of takeover premium
Upside of takeover premiumCPQ's recent takeover by G Corp was about $90 per oz of Inferred gold equivalent ounces in the ground.
CPQ's gold and silver grades were well below those of the Back Forty and both open pits started near the surface.
In other words, the Back Forty is a much more attractive deposit which should have very low cash costs.
The 43-101 estimate was about 2 million ounces of gold equivalent in early 2009 , with most of this being in categories higher than Inferred.
As others have pointed out, the update 43-101 will likley exceed the 3 million ounce level.
This would value the Back Forty at least to $270 million.
Assuming Hudbay earns its full 65 % this year, Aquila's 35 % would be worth at least $95 million or about $1 per share.
Of course, to earn its 65 %, Hudbay will have to take the Back Forty to a full feasability , which means that the takeover price will be much higher than $90 per oz.
As Aquila does not need another financing, Hudbay cannot increase its ownership of Aquila by way of another PP and will likley still be a 15 % shareholder by the time the full feasability is done.
This means that Aquila management are in the drivers seat , and will be able to drive a much better price than $90 per oz.