IMG and SMFThe most popular posts on these BB are those that fantasizes about a buy out. Let me throw one possibility out there - IMG taking out SMF.
Is this a possibility? Here are the reasons:
1. They both operate in Burkina Faso - I know IMG's Essakane mine and SMF's Mana mine are not exactly next door to one another, but they do operate in the same jurisdiction so some synergy could be created if IMG takes out SMF.
2. IMG has accumulated a lot of cash, over $1.0 billion in cash and cash equivalent as per their balance sheet at June 30, 2011. No executive would let so much cash just sit and do nothing besides collectiing interests for too long. The most logical assumption is an acquisition.
3. IMG's recently appointed CEO Steve Letwin, who came from Enbridge where he was previously a senior VP. Letwin's specialty at Enbridge was mergers and acqusitions. You give a guy like Letwin $1.0 billion he's likely going to buy something. So far he's been patient but IMG buying something is a given.
I did all these digging because I was interested in taking a position in IMG. However, under the circumstance I'll pass and wait and see what happens. The acquirer companiy usually takes a beating in its SP when a deal is announced. No point jumping in at this stage.
Who knows, the Friday pop in SMF's SP may even be someone thought IMG is coming (I'm just dreaming here, don't do anything please)! Isn't fantasies great?