GUY will be gone next year For several reasons noted below GUY is an obvious takeover candidate for senior and mid-tier gold producers. IMO GUY will be taken out by at least the end of H2/12 if not sooner.
- GUY is a clean, single asset (excluding Sulphur Rose) company boasting a large resource of 7+MMoz (this is expected to increase with updated resource)
- Minerals agreement is now in place
- Relatively low capex intensity for a project of this size (U/G capex will be funded by cash flows)
- Sizeable and scalable production of +250,000oz per year (peak rates above 350,000oz ) at relatively low cash costs of ~$450/oz (feasibility should more or less confirm these numbers in January)
- Trading at 0.6x NAV (~$12.50 using conservative pricing of $1200/oz LT) and $74/oz in the ground
- If you look at historical transactions take-overs have averaged 1-1.2x NAV and $150-$200/oz for developers of this size and quality
- do the math it should get taken out for at least $14.00 per share
I think the obvious suitor is IAMGold - they have historical roots in Guyana (Omai mine), operate the Rosabel mine in Suriname, and have the capacity to take on a high-quality asset like Aurora (they haven't done anything in a while on the corporate acquisition front). I wouldn't rule out other majors such as Yamana, Newmont and Agnico (they need something to fill the void of Goldex).
Bottom line this fits the bill for several potential acquirors!!!