Opinion on gold miners, page-9

As well as the macro factors, a lot of punters (such as myself) are trying to figure out the rationale for the Tropicana transaction and how they came up with the $903M evaluation, the $2.70 cap raising seems like a very long time ago. I use a pretty simple metric for acquisitions such as this, and that's the cost paid per Reserve ounce. Paying $903M for 800k in Reserves is roughly $1,130 per oz, which is absolutely at the top end of town.

I think RRL are still dealing with some backlash from this deal, which really blindsided everyone. The question should be asked as to why they didn't take the more patient, but far cheaper route of organic discovery and growth and grow their Reserve base at a fraction of $1,130 per oz.



In saying that, seeing the sp where it is is still a surprise, but I suppose the lesson here is that ill-timed and expensive acquisitions coupled with poor sentiment for gold miners in general can be a pretty toxic combination. But the glass half-full part of me can still recognize substantial value here.