copper back up, page-24

Hi Guys

I recognise that the copper prise has been less strong of recent times and that in itself could explain some of the weakness in CUO SP. However, I was wondering to myself if Macquarie, who managed to extract a fee (shared woth others) equal to 20mil 65cent options out of their financing deal with CUO, could be reducing their existing shareholding of around 3mil shares (from memory).

There are other potential sellers too, like First Rand who recently released a notice of ceasing to be a substantial shareholder. They may be reducing further. There is also Linq Resources Fund (LRF) and Glencore who were Macquarie's partners in provision of the subordintaed debt facility. Each of them may be selling down somewhat to maintain exposure through the options. That is typical institutional behaviour in my experience. Same happened recently with Avoca (AVO) and also with AED Oil when they issued convertibles.

What does this mean? IMHO it is a buying opportunity because once the selling stops the shares will appreciate to a new (higher) equilibrium level. That is especially so as we approach production commencement. I am pretty confident of substantial growth over next 2 months. I will not be buying more because I have no spare cash. But if I did, this stock would be a prime candidate.

regards
DF