High River Gold Mines Ltd HRIVF

IMO, the end game (funds need to stand up)

[production05]

If the share price continue to get suppressed, which I fully expect.  IMO, this is the end game below.

Troika becomes a minority shareholder with 150M shares, or 38% of the minority shareholder base.

Severstal launches another cheap takeover bid in 4 months.  If it's a bid they will still need 90% of the minority votes, which will likely still be rejected.  However, this time Severstal has ammunition to go into phase 2 of the process (Plan of Arrangement).

They will only need 50% of the minority votes (not total minority shares, just votes).  In my mind (it's a foregone conclusion), they will automatically get the 150M shares from Troika.  It's represents 38% of the total minority shares.  They will only need another 12% and the entire becomes Severstal.  Remember though, it's 50% of the voted minority shares that they need.  In other words, the 150M shares they will get from Troika will pretty much guarantee that Severstal gets 50% of the minority votes (as not everyone will vote).

In my opinion, if this transaction is allowed to go through now then we are done.  Severstal gets 100% HRG in about 4 months from now.  There is no need for them to allow the share price to run.  There is every incentive for the share price to continue to be suppress.  They can continue with the ZERO promotion approach.

The funds should try to do something about this.  They also need to apply a lot of pressure to the OSC and the TSX.

Why didn't HRG try to promote the company all this time to improve the share price for a financing?

Why didn't HRG roll over its current debts?

I find it hard to believe that a deal better than $.38 was not on the table. 

I find it hard to believe that the minority funds didn't propose better financing deals.  If they did then why was a lesser deal chosen.

HRG generated $52M in op cash flow in H1 and is expected to generate well beyond that in H2, especially with the much higher gold prices and more stable operations.  What's happened to all that cash?

[NaturalCurrency]

So if I understand you correctly, to block the next takeover bid from going into phase 2 of the process, 150M + 1 share need to vote no to the takeover bid. It might not be all that impossible to achieve it (block it from going to phase 2). There were 272M non Severstal shares outstanding at the last takeover bid and Severstal could only get around ~28M, so that means that there are more than

[production05]

Yes, that's correct NC, but (IMO) Severstal will take it to a phase 2 this time.  In my view, they didn't go to phase 2 last time because they got slaughtered in phase 1 and had no chance in the next phase.  However, they potentially have a partner this time.Yes, we will have to get 150M + 1 share + xxx shares.  The xxx represents the shares voting for Severstal (over and

[prouditalian]

Maybe Troika will allow the funds to participate. Don't draw conclusions yet. I agree that if they are not allowed this will not be approved by the TSX.