TSX:LSG.DB - Post by User
Post by
Trashenstein09on Feb 23, 2016 7:48pm
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Post# 24587454
Keep this in mind
Keep this in mind
Tahoe has agreed to buy LSG for $945 million (for properties, infrastructure, gold on hand as well as all assets and liabilities) and our BOD has accepted this. It is now up to investors to decline or ratify this agreement.
But keep in mind this detail
In 2009 Lake Shore gold bought out West Timmins Mining for $317 million as per:
https://www.theglobeandmail.com/report-on-business/lake-shore-gold-west-timmins-strike-deal-to-merge/article4195222/
Given that in the past 6 years we have transitioned from exploration company to exploration/gold producer, I find this valuation of $945 million too low when I look at the company qualitatively. I sure as he-ll hope the largest of shareholders look at this and shoot this down.
When considering what a fair value for your LSG share is, try to be objective given the drivel of a couple of pro merger posters who also seem to be promoting Lake Shore's neigbours.
When I first learned of this deal like everyone else, I remember feeling disappointed that my long time investment would never realize its end stage potential. In this deal (as I see it) we are gaining exposure to TAH's porfolio of properties, its infrastructure and dividends. But we are also joining into a miner which operates in Peru and Guatamala. As a LSG investor this is a red flag for me. I do not wish to invest in a company which could be adverely influenced by a Guatamalan government. And until these concerns are addressed, then its no thanks for me. Of course these concerns could be dispelled or disproven but I think there are many here who cannot go rah rah at company decision makers.