waht value cds, page-6

Mrs_Peel

A lot more than 7.7c that's for sure.

Cenennial Coal which is a producer has an estimated 1.1Bt coal reserves and a market cap of $1.442b.

Let's just assume the following:

- DD is sweet and CDS exercises its right to acquire a 70% share in the 3 Waterberg coal prospects.

- Fully diluted shares for CDS is 640m

- As an explorer CDS will be valued at 1/2 the potential MC of a producer.

- The 415Mt is not upgraded (70% of 415Mt = 290.5Mt)

- The coal grading of both CDS and Centennial is identical

Now the value of Centennial's MC per ton of coal is:

$1,442,000,000/1,100,000,000 = $1.31

CDS fully diluted MC would then be:

(290,500,000 x $1.31)/2 = $190,277,500 or a sp of 30 cents.