GREY:BHNGF - Post by User
Post by
cfhasibon Jul 21, 2011 2:25pm
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Post# 18857903
Splitting of properties
Splitting of propertieslast month, in one of my posts here, I recommended that GEM should Spin off their GOLD properties. Sounds thats exactly what they are upto !
I take this news very positively on several grounds - considering my personal experience in investing junior explorers, the news indicates positive move forward and here is my reasons:
1. Separating GOLD properties from REE and Uranium can suggest that - they are either preparing their GOLD assets go sell to other companies, and considering Gold at $1600, what is a better time to maximize your cash flow by selling them.
2. It will increase GEM's cash flow which will be needed in the development of Echo Ridge Mine - more cash flow, less need of financing, less need to be low-balled by others.
3. Separating gold assets - which I think may eventually lead to a spin off - indicates that GEM's recently released PEA is not rigged (as some skeptics think !) - GEM's managment truely believes on the deposit numbers otherwise they would never had separated GOLD assets !
4. This separation can also mean, other big REE buyers can buy GEM's REE properties - Lot of big companies only want to buy a particular property as oppose to all the assets, by separating REE vs Gold, their REE can be more effectively packaged out for big companies for a potential buy out - if and only if GEM decideds not to go to production by themselves i.e
Over all news sounds positive - I am holding on to GEM for few years until someone digs out the REEs and or it gets sold in higher $2s. I will pick up more if GEM goes below 20 cents !