a share buy back, page-14

Hi WangChung

Canceling the stock is a different scenario. It's probably easier if we don't confuse things with that scenario just for now. I'm not suggestin gthe stock be cancelled, just taken out of circulation.

For this scenario I'll make the assumption that OZ Minerals buys the $1.5 Bil of stock and holds it.

>Conversely, OZL now have $1.5b less in the kitty, for >future acquisitons, expansion etc...which is likely to be >perceived as a negative.

Wrong

If a great opportunity comes along then instead of buying with cash OZ could buy that opportunity with stock. This is called a swap and is a very common way for companies to merge and purchase each other. Cash is not needed. Also it's hard for the market to value cash in the stock price as it's difficult to verify.

>EPS should go up, as there are now fewer shares to divide >the earnings between....rising EPS is likely to be >percieved as a positive.

True

>Basically, a share buy-back is signalling to the market >that management believe the best valued mining stock in >their universe is themselves.

True, and this is not a bad decision for management to make. We as investors are making the same decision and are the best qualified when we choose to invest in companies. We can buy Xstrata or RIO ourselves. Management should manage and investors should invest. By buying companies management are trying to be investors and that is not the job in which we employ them.

>The number of shareholders is irrelevant.

Demand and Supply is very relevant to our markets and our whole capitalist system is designed around demand and supply. The less shares, and the more people want them, the higher the shares will go.

Ryan