Ann: Spin-out of Ardeas Kalgoorlie-based gold assets into KAL, page-30

Hi Flashgrains and Sirgoldinger.
Yes you are correct in that ARL shareholders are being diluted, this effectively is by the introduction of new shareholders into the KAL Gold IPO.

BUT, and its a very big BUT.
The tenements currently being divested may never be developed if they remained in Ardea Resources.
The reason for this is a very narrow focus of attention once the partnership is announced, this will be a nickel focused company with everything else falling into a second priority, possibly a never priority.

The gold left in Ardea tenements is contaminated into the KNP and Goongarrie resources, (or very close by) warranting extraction.
Satellite resources will more than likely be ignored.

So when you consider the risk of some resources never seeing daylight under Ardea in a new partnership agreement, it is better to accept the dilution and at least have the opportunity to benefit as best possible through a new IPO focused on the dedicated satellite resources.

The IPO guarantees attention is given and priorities are determined with regards those resources included in the divestment.
In this way we at least know that the resources are developed sooner rather than later.

Those retained resources remaining will more than likely help with cashflow, funding and revenue if and when developed
RED