Ann: Divestment of Heemskirk Tin Project Interest, page-8

re: Ann: Divestment of Heemskirk Tin Project ... Yes, and doesn't this deal proposal once and for all reveal what a scam the spin off has been?

Anyway, the price is OK in my book. No complaints here. What is unclear to me though is what Gandel's true motives are. Is this a move to support Gippsland or gain control over Heemskirk?

In the former case Gippsland would sell its Stellar shares ASAP (1/2 of the shares 6 months after closing and the rest another 6 months later if I recall correctly). Since GIP will be out of cash by the end of February 2012, they are in need of fresh cash. GIP could borrow money from a bank and use the Stellar shares as collateral in the meantime, until the shares can be sold.

A long term direct shareholding of GIP in Stellar doesn't make any sense to me. This would neither help GIP out of its cash problems nor would it change the situation regarding Heemskirk. A 28% stake in Stellar is roughly the same as a 30%/40% share in the Heemskirk project. So what would have been achieved?

The third possibility is indeed a distribution of Stellar shares to GIP shareholders. This can be seen as a path for Gandel to gain a >10% foothold in Stellar = Heemskirk. In this case Gippsland would not receive any cash and would have to do a separate cash raising soon.

So it is totally unclear to me what Gandel's plans look like. Should the Stellar shares be distributed to GIP shareholders, this would be a positive for the shareholders but not for Gippsland itself. The company would have lost one of its most precious assets without receiving any much needed cash.