RE: Oromin plus Randgold2 months ago I.said:
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Randgold is the.only one of the top-tier or mid-tier golds making new highs at the.same time gold is making new highs. However, they need to balance their spectacular but risky Congo project with a grand.Senegal project in a much safer and stable country. Randgold.should buy Oromin before someone else beats them to it.
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I didn't know at the time that their superb Ivory Coast (Coted'Ivoire) project was also in a risky country.
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Since.peaking in October, Randgold has lost $20 per share – about US$1.8billion. Although gold bullion has come down and Randgold was very.richly priced, the main reason for the big loss is as follows:
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The.company said it is ‘closely monitoring the political and security.situation in the country’ following elections that resulted in two.candidates claiming to have won the presidency and appointing their.own prime ministers. There are fears that an escalation of the.dispute could result in a return to war.
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The country is still.divided between the rebel-held north and the government-held south.following the 2002-2004 war.
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Randgold should.have used their richly price stock in October to buy Oromin, for all.the reasons I outlined in my original post. They then could have.used the news of the coming huge increases in Oromin resources due to.recent expanding grades and widths at depth in all five major.deposits to buffer the bad news from Cote d'Ivoire. Randgold is one.company I'm sure would have been capable of translating the good news from Oromin into higher stock valuation (unlike current Oromin management).
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Randgold should still buy Oromin – would probably help get Randgold to new highs.
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Click here for Randgold chart