KWG Resources Inc C.CACR

Alternate Symbol(s): KWGBF | C.CACR.A

Metals & Mining Industrial Metals & Minerals

KWG Resources Inc. is a Canada-based exploration stage company. It is focused on acquisition of interests in, and the exploration, evaluation and development of deposits of minerals including chromite, base metals and strategic minerals. It is the owner of 100% of the Black Horse chromite project. It also holds other area interests, including a 100% interest in the Hornby claims, a 15% vested interest in the McFaulds copper/zinc project and a vested 30% interest in the Big Daddy chromite project. It has also acquired intellectual property interests, including a method for the direct reduction of chromite to metalized iron and chrome using natural gas. It also owns 100% of Canada Chrome Corporation, a business of KWG Resources Inc., (the Subsidiary), which staked mining claims between Aroland, Ontario (near Nakina) and the Ring of Fire. The Subsidiary has identified deposits of aggregate along the route and made an application for approximately 32 aggregate extraction permits.

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KWG Resources Inc

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Post by Trix1on Jun 09, 2010 10:02am

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Post# 17172284

Distribution Pre/Post Merger

Johnale, don't worry about the distribution of DD (1% NSR and railway rights) being dependant on a successful merger. If the merger fails, I would think the KWG board of directors would still decide to spin it off.

I am sure the whole idea to separate out the NSR and railway rights was a means to make the merger fair (ie. both parties give 30% of BD to the combined company). It probably didn't take long to realize how great a move it was to create value for us KWG shareholders. With the spin off, Cliffs now has to buy two companies. One can easily assign a value of 10 cents to the NSR. One analyst wrote that it could be closer to 26 cents. I do not have a clue what the railway rights are worth, but I am pretty sure that Cliffs would want that as well.

I would like to buy more KWG at 13 cents but my holdings of KWG/SPQ are now 20% of my portfolio. Far too high for conventional investing guidelines. But gees, this sure seems like a steal to me.

Does anyone have any ideas as to the value of the railway rights?

Trix

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