Tail wagging the dog?, page-16

Would be very disappointing if HGO were to merge with RXM.

HGO is a producing mine generating positive cashflows.

RXM is a development project that is absorbing cash.

They are located in very different locations with a gulf in-between them. They are almost opposites in term of their features - Kanmantoo is close to existing infrastructure, close to Adelaide, great connectivity to electricity, water, roads and ports.

Hillside is a long way away from suitable infrastructure with insufficient water and electricity and requires major spends on infrastructure to support the project.

It would not be a merger of equals.

In my opinion, RXM is in strife. The original project is dead and they are having to redo the whole project but dont have the cash.

HGO could acquire the Hillside asset for next to nothing after completing due diligence to confirm it is actually worthwhile developing - no need for a merger.

At the moment Hillside/RXM is one ugly duckling.