& gul - whats the relationship?, page-2

RACI

GUL and AGM are indeed very closely related. Some common directors and a common office.

As you state GUL has a touch over 10% in AGM, they also have 1.2 million options exercisable at 20c by 31/12.

AGM has a 20% stake in GUL (from memory)

Basically GUL, besides the AGM has no other business except for a block of land in St Ives (Sydney for those non Sydneyites).

AGM has 230 million shares and 60 million options on issue. GUL has 106 million shares.

The share prices "should" run together but obviously are not. In fact GUL is undervalued on paper. 23.8 million shares in AGM is worth 4.76 mill + the land + a bit of cash should see GUL at 6c per share.

My theory is that there is a discount to GUL because of a lack of liquidity.

Last week GUL came out with the agenda for their agmeeting and said that they want to issue a whopping 45 million shares in the company. The reason given was to invest in other projects as well as the usual working capital requirements etc. I had a quick look but could not see anything specific about the new projects. Maybe this has lead to the drop in price and sellers outstripping buyers.

Their website is certainly not up to date. I think the best way to get info is to look at the latest releases.


Chinkiat