Spec I did not say that SPR would not be willing to make a deal....

Spec

I did not say that SPR would not be willing to make a deal. All I said is that they would demand too much of the upside (which for WGX shareholders would mean excessive share dilution). SPR is now basically a subsidiary of its two main shareholders if they wanted to work as a team and milk any deal to the max. What they would seek is to recognise now in the deal the future value of SPR as if it were already a fully functioning 180-200k ounce pa producer, which is what SPR may be able to achieve over time.

Therefore its futile for WGX to pursue a merger with them as it would be extremely dilutive to current WGX shareholders with little benefit of the merger going to them. This issue is accentuated by the fact that WGX has a long history of underperformance reflected in its share price (and hence lower market cap) and will take time to remedy.

WGX should focus on mergers of the cheaper explorers that have a useful resource/reserve and are under valued (just like WGX is) so that in a takeover via scrip both sets of shareholders could make useful gains.

In any case, I think WGX can get to a market cap closer to $2 billion if they deliver on the expansion program and continue expanding their reserves.

Simon Lawson will simply have to develop a DFS etc and seek funds to re-start mining operations at some stage in order to satisfy the aspirations of its two main shareholders unless there is some larger producer (NST?) with the financial heft to take them over for full value (like poor SBM did when buying Atlantic Gold). EVN is already too indebted to make such an offer, I think, and RRL is too weak and has a project to develop. PRU could fund such a takeover, but would they want to operate in Oz and at what price? dunno

loki