RE:RE:RE:Deal looks good to me...For what it's worth...
To me, at first look, this appears to be a smart strategic move, and a deal that favours WDO somewhat.
It's smart strategically, because they turned an asset that was just sitting there into cash that will pretty much ensure that they can restart Kienna without having to borrow or issue equity.
And they did it without losing control of the asset. They keep 30% interest Goldshore, without even considering the additional shares to be issued to WDO over the next 4 years. If the share price of Goldshore stays at the PP price ($.65) WDO will get another 30 million shares over that period. That will protect WDO from having their stake diluted, if nothing else. If there isn't any dilution (there will be), they'll end up owning close to half of the company.
After the combination, the new company, Goldshore, will have 100 million shares out, nominally worth $.65 (the PP price), or $65 million.
It would be interesting to know who currently owns Goldshore. They're benefitting even more than WDO from this. They get 30% of the new company (worth $20 million at the PP price) for their existing company which appears to own $4.4 million in cash and a name. A 5 bagger for negotiating this deal - nice work if you can get it.
The shareholders of Sierra Madre get 3.7% of the new company worth about 2 million. Basically all they contribute is their listing on the TSE. Given that was approximately the market cap of their company before the deal, they don't benefit immediately, but they aren't being hurt either.
The PP subscribers get 36 % of the company for their $25 million. Compare that to the 30% going to the unnamed current owners of the original private company Goldstone for $4.4 million and you can see why I think the original Goldshore owners are the big winners here.
As a WDO owner, I like it. As an inverstor who's interested in the sector, I'll keep watching Goldshore for future developments, but I don't expect to be jumping in soon.
Long term, years down the road, if Goldshore succeeds in developing Moss Lake, WDO will be in a position to buy it back as a working mine without having to take the risks and put in the time and attention to developing it. When time comes for a take-out, WDO will have a head start over any other suitors with their 30% of the company.