RE:dealcashtango00 wrote: I was involved with Nevsun through the whole process, and it was painful but eventually quite profitable. Nevsun paved the way for other companies in Eritrea and basically taught the Eritrean government how to deal with capital markets and public companies. I have kept my eye on SGC over the years and am impressed with the job they have done to get this company to the stage they have. These have been very difficult market conditions and in a country that is not always easy to deal with.
Saying that, the company and paid letterwriters can spin this deal anyway they want. The reality is SGC was put over a barrel on this one. The government knew they had them in a corner and this deal is not great on a valuation at all. For the risk and capital outlay SGC has made to get here, the Eritrean government has 40% of this play and got it VERY cheap.
Saying that, there is still money to be made here, just not in the quanity it should be.
I agree! The article writers and investors on this message board tried to make it seem like Enamco paying 1/3 of future costs is a big deal. This doesn't benefit the company nearly as much as people think considering Sunridge Gold will lose an additional 30% of their potential future revenue on this project in exchange for selling Enamco a 30% stake on the project. Plus costs have gone up over 30% since Nevsun began construction on their project. If you do the math on this deal it does not add up.