Tropicana, page-110

Great points. Yes Loki, as you said.... "the one concern is that the management might splurge the surplus cash on another less profitable project". That's a big risk. If they did a deal like buying half the Super Pit at the price NSL and SAR bought in for, I'd be stoked. That was value add.

Don't make the mistake of comparing the share price with production of 350oz unless you take into account the massive increase in the number of shares on issue post deal. RRL isn't the same beast pre & post deal. RRL was very cheap pre-deal based on cash holding, current production & latent value in McPhillamys. Post deal that's no longer the case because of the dilution through the CR. That's where this deal fails. You're still producing the same number of ounces (assuming of course Anglo exercises its option) only now those ounces are apportioned to a much larger equity base....hence the reduction in return on equity and underlying value in existing shareholders holdings. Post the capital raise, value per share has decreased and you're seeing that in a much lower share price that is below the theoretical TERP. Any way I look at it, the deal destroys value for existing shareholders, myself included. A buy back doesn't remedy that either unless they buy back shares at above the TERP and they'd need to return the entire amount raised at that price just to get you back to square one. I wish but that's unlikely.

If the deal had merit, shares would be trading above the TERP. They're not. It's no coincidence that IGO shares are trading higher than before the deal.....there was a winner here & a loser on either side of the transaction. I'm a loser & so are you if you were on the register before the deal was announced whether you commit to the raise or not.