Post by
caillen on Apr 20, 2015 9:51am
Reality
So...here's reality...TMM picked up (or will pick up) NES for $78M in a swap deal (shares for shares). Dilution is in place with 106M shares of TMM set to be put out (.9 x 117M of NES shares) for a minimum of 2m ounces in gold to a maximum of 5M ounces. In other words, TMM just paid $78M in shares for a minimum of $2B to a maximum of $10B in revenues (2M x $1,000 up to 5m x $2,000). That's on the balance sheet. No money was spent. No indebtedness. Shares were issued. The company is now a stronger company with respect to its balance sheet. Period. Even if they don't proceed with either Ana Paula or Caballo Blanco, it's still a stronger balance sheet. I would have done this anyday. Not to do it would be insane. Now, they can sit on it an wait until the price of gold goes back to $1,500 or $2,000 - regardless of when that might be...1 year...2 years...5 years...or even 10 years...and then they can raise the capital needed to realize on these properties.
It's the absolute right move and kudos for it. Eventually, the share price will reflect their new balance sheet and their new valuation from either a take over target or to a realization on the assets.
Comment by
pdcon1 on Apr 20, 2015 11:27am
i think your both right to an extent , short term it sucks with the drop in price mainly because big sellers are getting out . once selling stops we should climb back over a dollar. Long term its a good deal as long as they dont come out with a cheap pp. Meanwhile tmm keeps producing gold . As far as a takeover , will come to a vote. and a lot is riding on the price of gold .