Finally Management Gets it Right Hallelujah! FInally management and the board did something truly in the interest of its share holders. This is the best deal we are going to get!
As a shareholder you have two ways to realize value from your ownership stake in the company: 1.Through Dividends (return) and/or 2. Increasing the value of the company so that someone else buys it. Ignore the hypothetical worth of your shares based on the hypothetical resource in the ground. Companies themselves are things that are bought and sold.
Ask yourself, with 20 years of experience with the OX management and Board what the probability of #1 or #2 coming to pass are? Now look at ANX and ask yourself what the probabilities are?
Frankly I will bet on ANX. My reasoning is as follows:
- $7.4M revenue in last quarter and $12M revenue in last six months
- $450k of interest free debt on balance sheet
- Sitting on $4.4M of gold in inventory waiting to be sold
- Was able to obtain $2M equity financing in form of private placements for further properties in the last 6 months
- $1.8M EBITDA/Cash flow positive in last two quarters
- Plant and stripping assets are fully owned (not financed)
- Multiple properties under exploration
- Producing Gold now
- All of this in 5.5 years
The only downsides I see are:
- Potential for Jacques and collaborators to have too much power as a large voting block (although I note they are not getting a board seat!)
- Potential for reverse split to deal with the Massive number of shares outstanding (However a reverse split would boost ability of some large equity funds to buy ANX stock increasing the share price)
- Further dilution through private placements (presumably offset by value of those assets eventually increasing)
In my estimation ANX has a very good chance of returning a dividend to its shareholders, and/or increasing its perceived value as a company so as to be bought by someone at a higher share price.
The deal also only requires two-thirds of shareholders who vote at the special meeting (not 2/3 of all outstanding shares) to approve it. With 25% of all outstanding shares being represented at the meeting its pretty much a foregone conclusion this will pas. In the end, there is little OX shareholders can do if they wanted to counter this move. Frankly those of us upset with OX management have not been able to coordinate nearly well enough to counter Jacques and his friends at any other board meeting, not sure how anyone could be successful now.