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EMR

2.89%

$3.36 emerald resources nl

Ann: Recommended Takeover Offer of Bullseye Mining Limited, page-15

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binwood

9,013 Posts.

3848

07/12/21

11:57

Post #: 58125923
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Originally posted by speculator101 ↑

Well, it puts to rest that AUC is not the target.

Very interesting location.... with multiple plants within trucking distance.
Bronzewing being in C&M and Darlot... not having made any money in years (no matter how much RED tries to say otherwise).

I get the feeling that the company is trying to explain very clearly, that they view this asset as their 3rd production hub... as in, it will be over time as they explore/develop the asset. With... their Sprott debt facility likely to be used to offer cash & script for the asset that is likely in production right now. Also, this asset is not going to enable them to mitigate the tax issues they have clearly telegraphed to the market,

Am I wrong in thinking that that EMR might be looking at entities that are perhaps, sub optimal currently (as in, for whatever reason, not producing at low costs, or have operational issues), but... have large tax losses already booked?

This is the first key benefit they list....

The others are there too, but... honestly, to get this asset into production (without the purchase of Bronzewing or Darlot) will be a minimum 2-3 years at the earliest. EMR will have accrued a heck of lot of cash in that time.

But.. they state this too- (so... really not sure what to think in the short term).

I must admit I am not overly excited about the lengthy list of legal claims, though I back EMR to be able to mitigate them.

The price seems.... very generous, even if the MRE was double the 250k currently, that is still $234 an ounce (approx $470 per ounce on the current MRE). For open pit resources, that is.... high.

I feel that, with what little I know now, the Bulleyes holders have done very well out of this. As EMR is undervalued considering its current project is very low cost. Especially when I compare this deal to the one CMM was able to pull off only months ago.... $40m for a 2m+ ounce MRE project in W.A.

Expand

Let me start by saying I am 1000% speculating.

I think the deal goes like this. We lock away Bullseye. We then take out Bronzewing for $50m + $70m for rehab, done completely with the Sprott debt.

Once we have locked up what we need then we can telegraph the strategy to the market.

We have 35km of drill logs not in an MRE. If grade continuity exists this could easily double or more the existing MRE. I am gonna guess and say we have 600koz there at 2g/t.

2Mtpa plant at 2g/t is basically replicating Okvau data so we add another 120kozpa production. Probably another A$140m p.a in FCF.

Bullseye already has ML approved. If we buy the plant then in terms of feasibilities a lot of hard work is done. Just need to work out a mining plan. Could be producing in 18months IMO

Then they will start cleaning up the stragglers of the region.

Watching the PA today says there is more to this than is yet apparent. Or at least that is my take away

EMR Price at posting: $1.12 Sentiment: Buy Disclosure: Held
14 Upvote

4 Great analysis

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