news is out vrx investment, page-30

Two perspectives;

1. The company raised at the peak in its share price and has bought a stake in a quality distressed asset at the bottom of the market. They are great at market timing. They have found a cheap means of shoehorning the 20% pre bid stake from a near insolvent company with a quality asset and NST will create enormous synergies by combining their near by assets after ultimately taking control, perhaps leveraging the feasibility study while quarantining NST, as a low leverage pure gold play.

2. These guys made a dilutive issue to the detriment of existing shareholders and having alienated their investors, the price and momentum has never recovered. They are now wasting shareholder funds in an agency cost motivated diversification spree, such that, "if we fail here, then we can pay ourselves for succeeding there. " Of course if investors wanted a stake in an undercapitalized copper/zinc play they can buy it themselves on market. Investors do not need over cashed CEOs to create their diversification strategy.

Management has significant personal wealth invested. This tends to moderate errant behavior. But in my view as a CEO, bb is an excellent engineer. The question is whether an excellent engineer is a good CEO.

I am previously on record on this forum, explaining the agency risk of excess cash.

Listen carefully to bbs recent presentation where he says " we needed the uk investors on the register to do what we need to do". Well what exactly do they need to do that a specific institutional investor is going to deliver? Ramblings of someone who has no idea what he is on about or hints of a master strategy that is yet to play out?

I hope that my jottings on agency costs were not premonitions and that option 1 is the path that they are on.