How do you calc a buyout number?IF and I stress IF we were ever subject to a buyout offer. It would be based on the following criteria.
Value of finished product- I am assuming $15K
Number of Probable tons of concentrate- I am assuming 15K at this precise moment
Market size
Value of finished product, would at best fall during a long period of time, but the good thing is the market would also increase offsetting any drop. So if you believe 1500 tons at $15K then we would sell 2000 at $13K etc as time went on.
Resource, I am on record as saying 15K east block at the moment with alot more work to do and 560K tons of concentrate on West block.
Lets suppose for a moment its 100K tons. and assume after expenses we pocket $12000US per ton
which with Marbelous credits I believe is more then "doable".
The insitu value is 1,200,000,000 assumong a 20% insitu value on buyout, which is highly likely when discussing premiums for property and you get $240,000,000 offer.
Why a premium? Ease of access, Product at surface, Quarry equip in area, Rail system Power etc as well as a fully functional Mill totally licensed. So the mill is the ticket and thats why I give credit to Mr Duncan on acting quickly regarding the Tailings pond on Asbury. Why? Because anyone wanting to move into Canada wants a "footprint" and all the enviromental hurdles already done with.
They are not interested in a 2-4 year start up.
So if they wait till next summer, and we have increased our rolling resource on the West Side then I think a buyout at $1.50-$2.00 would be fair for a fully ticketed company with a niche market.
Its not about ROI for companies that want to move into Canada and have a functional facility and source. Its to get set up as a Specialty manufacturer with ability to expand quickly as the market expands.
So my vote would be, if the offer is not over $1.50 lets go it alone because by the summer of 2016 the hard work will be over.