scheme meeting 16 june, page-23

Muzza,

Interest payments on debt are tax deductible, and the spread on borrowing costs for OXR I doubt would have blown out 400 bps (but both figures before and after are probably higher than 5% and 9%).. more like 200-300bps I would think. So you are looking at differential of $14-21M on $1b.

You have to look the cost of equity and cost of debt, your argument is the cost of debt is way higher than cost of equity, so use OXR shares to buy cash..

However if you are of the belief that with copper at $4/lb, OXR shares should trading $4.00 to $4.50 currently, on their way to $6 by the end of year when PH starts up (+$150m/quarter to earnings)... and if you are to believe Barry Dawes who said copper will hit $6/lb this year (2008) then perhaps this becomes a very expensive exercise for the sake of cash.

.. just had to plug $6/lb into my model of OXR.. for 2009 at fx 95c going to $1.01 by end of '09, gold at $919/oz, zinc $1/lb, ag $17/oz, lead $1, OXR would be on a PE of 10x at $8.29, PE 15x at $10.36