I was just about to post on the RED thread that SLR could be the...

I was just about to post on the RED thread that SLR could be the one doing the buying as part of a backroom deal to fully take them over when I saw the announcement on the RED thread.

It must be more than just a blocking stake to spite GMD which outbid them for the Gwalia.

I think that if the RED mineral resource/reserve estimates are basically correct and they can continue operating at recent production levels/costs with the current gold price, then its an OK investment so long as SLR can either t/o RED or be able to divest its interest later on at a higher price when it finds better use for its $100m RED investment.

It is always possible that GMD and its backers may themselves take up a blocking stake in RED to stop SLR from getting RED cheaply. Not sure why SLR has waited this long to make its move - RED's shares were much cheaper earlier in the year, but SLR were distracted by its Gwalia acquisition attempt.

I suppose the move highlights concerns about the longevity of SLR's operations.

SLR's future success or failure will be mostly dependent on what happens at its Canadian operations and mine life extensions at its Oz mines. SLR's kitty may be down to around $250m at the end of the month?

loki