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MICHELAGO has severely tested the patience of its shareholders in the past couple of years.

That many of them didn't hang around for its environmentally friendly China gold push and its involvement in the planned restart of the Gold Ridge goldmine, in the now not-so-friendly Solomon Islands, has been reflected in its miserable share price performance.

While everything around it has been booming, Michelago has been on the skids. At Friday's close of 2.7¢ a share, the company was being valued at about $27 million, or about half of what it was a few years ago.

But patience does have its rewards, with Michelago now being wrapped into Canada's Golden China Resources — a major creditor of the group — through a scheme of arrangement priced at one Golden China share for every 37.5 Michelago shares.

While there was more indigestion for Michelago shareholders with a last-minute tweaking of the share exchange ratio, the fact remains that a much brighter future is now at hand.

The Canadians, the most adventurous of junior mining investors, can be relied on to value the enlarged group at a multiple to what the Aussie market would have done.

That has been reflected in the Canadian market's $21 million valuation of Michelago's 23.8 per cent shareholding in Australian Solomons Gold, the Toronto-listed group behind the planned restart of Gold Ridge.

By extension, that meant the Aussie market had been valuing Michelago's China business at two-fifths of stuff-all.

The Canadian market won't do that. While Michelago has yet to make much out of its China gold push, there is a certain appeal about a trailblazing operation that recently picked up the inaugural mining environment protection award at the annual China Mining conference.

The award was in recognition of the ability of Michelago's 120,000 ounce-a-year BioGold plant in Shandong to treat highly refractory ars enic gold ores in an environmentally sensitive manner.

China has loads of refractory (difficult to treat) ores and there is little doubt that access to the BioGold plant will be a handy bargaining chip in both the growth of the Chinese gold industry and the merged group's China footprint.

Having said that, the Michelago/Golden China combination will have more of a traditional mining company feel. While Michelago contributes processing expertise and the ASG investment, Golden China brings a portfolio of advanced exploration properties.

Michelago's independent expert on the merger, Resource Equity Consultants, reckons Michelago's