RE:RE:How Much SGNL Should Pay For Your Shares?Thanks for your input Grumpy
GrumpyInvestor wrote: Hi DoumDiDoum,
I don't see why Signal Gold would be tempted to acquire MAE at the price you are suggesting at this moment. They have no cash, and they will need to do a major financing to build their mine, around 60% dept and 40% shares.
That's exactly why I'm saying SGNL might be interrested to make a move since MAE is not in a good shape right now.
GrumpyInvestor wrote: Right now, if they gave SGNL shares in exchange to buy out MAE for $60M, they would be "giving away" more than 33% of the company !
Perhaps 33% of the company is what SGNL should pay, even if their SP is undervalued right now. SGNL can wait get re-rated but MAE will say that they are undervalued too so at the end, it might all be the same. But I get your point, you think 33% or $60M is too much paid for MAE.
GrumpyInvestor wrote: I think SGNL might consider acquisitions once they reach production at Goldboro and their share price is over $2, but right now, the transaction you are suggesting doesn't make much sense for current SGNL shareholders.
But don't you think securing 70k ounces/year at Point-Rousse for SGNL and expediting Hammerdown in production benefiting from the "soon to be" gold bubble that might happen in the coming months is a win-win for both companies? It's unlocking Hammerdown value right away and allows for the newly merged company to explore the other promising areas (Whisker Valley and Tilt Cove) allowing for a quicker growth. You will have your 2$/share valuation more rapidely than waiting for Goldboro to produce dor bar in 2 to 3 years from now IMO!