"IGO won deal of the year at Diggers for selling Tropicana"
WOW, your first post on Hot Copper ... and its on a stock you don't own ... and its projecting disinformation.
IGO won "Dealer of the Year" at D&D, for transferring itself into a battery materials Company when buying a minority interest in Greenbushes Spodumene (which turned out to be a magnificent acquisition). The Tropicana sale enabled all of this. IGO was a motivated seller. Anglogold had ROFR to buy out IGO. They declined.
https://thebull.com.au/winners-from-the-2021-diggers-and-dealers-mining-forum/
Viewed as a stand alone asset, Tropicana could justify a value in excess of A$5b. A 30% interest therefore, would justify the entire MC of RRL now.
A$1300 margin on 130ozpa (30% interest) for a 10 year LOM gives a total return of A$1,690m. RRL paid A$903m.
The A$POG has increased ~A$200 since the acquisition. Exploration drilling subsequent to the sale, reveals likely LOM extensions, especially given the higher grades found with deeper drilling.
The recent purchase of Pretium by Newmont for A$3.7b, validates the price paid by RRL for its acquisition of a 30% interest in Tropicana.
On the other hand, McPhillamy's strikes me as somewhat pie in the sky. A 90km water pipeline? Hmmm. The BOD is focused on minimal spend until permits are granted.
Then there's Duketon. It produces almost 3 times output as Tropicana (30%), albeit for an extra ~A$200 per oz. If not 3 times, then double the value of the Tropicana acquisition, still (theoretically) contributes A$1.8b to the MC.
Theoretically, that's a MC of A$2.5b, after deducting net debt of A$200m.
RRL, an undervalued Company in an undervalued Sector, IMHO.
A former Director putting the boot into the current BOD is ugly and poor form. A Q2 forecast of similar results to Q1 is unpalatable ... still, FY guidance maintained though. I doubt there will be any encouraging news until Apr22 at the earliest.
In these days of hot money flows, there's little to drive the RRL share price, unless the POG increases ... and current Sector indicators are negative.
I thought I got a great deal on 3Nov21 at $1.905, I still think so.
Miss RRL sits there like a wallflower, all I want to say to her is ...
https://www.youtube.com/watch?v=PDJPpG8e4n4
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Price($) | Vol. | No. |
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