Duluth Metals Ltd DULMF

DM valuation

[mayorkgh]

In December, TD's 10%NAV was approx. C$400 million. In September, Raymond James 10%NAV was more than C$800 million. DM's equity base is 150 million shares fully diluted. Even if they sell another 50 million shares at whatever price, this gives a share price range of $2 to $4. Presumably the 10%NAV will be increased by both analysts when the PFS is released, likely in July. DM has enough liquidity to get to that point and will then have to make some decisions as to how next to proceed. There probably wasn't much point in pushing the most recent financing at 65¢ if they don't need the cash at this very point in time...better to wait until the market is more receptive and until DM has a different story to tell. There is no doubt that Anto won't pay any more than they have to however that price will be determined either by the 10%NAV calculated in the BFS, which will be produced some time in 2015 but for which the PFS will be some kind of guide, or by a takeover bid, which will give rise to a competitive situation between Anto and another company. It's all a question of timing. Probably the worst case scenario is another company offering a buyout at a 50% premium to today's share price i.e. $1.00 or so, which would sound fair in the headlines but which would understate the real value substantially.