Galway Resources Ltd V.GWY

Value of Vetas

[SchiffKnowsBest]

The Value of Vetas is relatively simple in my view.  By simple I mean that this is an area that will be developed.....The only question is......By Whom?  With that in mind, the multiple per ounce in the ground goes up.  A generic, average grade, non-strategical asset would receive about a $35/ounce multiple for each indicated and inferred ouce (about $50/indicated and $25/inferred).

 

When you start throwing in:

 

--> Very high grades (8g/tonne IMHO)

--> Bare minimum 1,000,000 ounces TODAY!

--> SIGNIFICANT SILVER CREDITS

--> Batista being one of the biggest shareholders

--> Management with a great track record

--> Colombia becoming much more mining friendly

--> A huge land package

--> Huge cash position

 

Then you start throwing a minimum valuation of $100/ounce for today's ounces.  Remember, California went for ~$200/ounce, and that would include the fractions that weren't in the 43-101.  If you strip those out then we are talking $250/ounce.

 

So, with this in mind, the math is easy from there.....

 

1,000,000 ounces * $100/ounce = $100,000,000 (multiplied * 90% ownership) = $90,000,000 

 

$90,000,000 / 145,000,000 shares outstanding = 62 cents.

 

You can factor in the cash above that if you like, but I am leaving it out for now to give further backing to the $100/ounce valuation. 

 

So, the value when this goes down in December is $2.05 + 62 cents + 9 cents (at least the cash value of Victorio).  All of course in my humble opinion.  Some will say it's worth more than that and I likely agree with you, but this is again a conservative estimate. 

 

= $2.76

[Geef]

Thanks Schiff.  So what it boils down to is $2.5 - $3.00 / share total as a range depeding..........

[madrock760]

WOULD IT BE SAFE TO ASSUME IF IKE IS PUTTING 18MIL INTO VETAS AND RETAINING 10% OF THE THE STOCK IT WOULD VALUE THE SPINOUT FOR VETAS WELL OVER A DOLLAR. I WOULD ASSUME IKE WOULD PUT IN WHAT HE THINKS IT IS WORTH RIGHT NOW! HOW MANY SHARES WILL HE HAVE AND BASE IT ON THE 18MIL GOING INTO SPINOUT.   MADROCK

[ikebalinski]

This post has been removed in accordance with Community Policy

[mjh9413]

Last thing I saw was AUX and its brothers and sisters owned about 12.4MM GWY shares so 0.9 times that is what they get as a minimum holding by AUX after the deal. Given the math the easiest way to look at things is to say they will have 10% of new Vetas spinco shares so 10 times $18MM is what some poster stated before. . That's close to at least $1.60 per share if market cap is refelcted in

[mjh9413]

After writing the preceding post I realised the there is another way to make the calculation. So here goes. The $18MM cash is divided amongst about 266MM total shares in the 2 Spinco's post merger. That is 6.5 cents cash equiv per share overall to be added to the $2.05. If that 6.5c represents just 10% of the value of the two spinco's (based on AUX's ownership) then GWY share is worth

[mjh9413]

Realise I am talking to myself but focus on keeping Vetas Spinco (my intention) made me focus on $18MM but on $30MM (which it should have been since I included total shares issued for both spinco's)  it of course works out to a probable minimum value of $1.10 on top of the $2.05 cash post-merger. The pre-tax NPV on the Tungsten proj alone was over$250MM so $1.10 for both spinco's

[neinstein]

How is Batista getting 18% of vetas? 1) AUX, in buying GWY, is keeping 10% of the Vetas project. AUX is buying gwy. AUX gets 10% here. 2) AUX, etc. owns 12MM+ shares of GWY. AUX, etc. will end up with the spinout shares just like the rest of us who are long on the record date. AUX gets another 8% here. On a Vetas valuation - in my opinion it is easily, and conservatively, $100MM+ ($0.60/share