I posted the below commentary on the SLR HC blog - my comments about SLR's self centred management apply equally to RED's management.
Col and I share some overlapping views on management.
For RED's long suffering "loyal SH's", only a win-win-win M&A will give meaningful return in a meaningful time frame .... IMHO.
RED is the "undervalued" asset ripe for the picking .... SLR is desperate for M&A and GMD is just a cheap asset play vehicle for a great operator.
Let the games begin !
NST "super pit" was created by combining many pits and the end result is a very long life, tier 1, investment grade, ever green super company.
Consolidating Leonora's main players would achieve the same - the only real obstacle is the ego and self interest of individual company managements.
SLR has been a gold producer since 2007, before its merger with Integra, which supplied the Mt Monger plant and numerous open pit opportunities.
After the SP collapsed post the gold price collapse in 2013, Cool Hand was bought in as MD in 2014 when the SP was 14c.
Yes, he steadied the ship and achieved the transformative Doray acquistion, which magnified the SP to lofty heights .... and greatly expanded production, and for this he's been richly rewarded with about a A$1m per annum - he regularly harvests his options ..... but where are the shareholder dividends ??
Growth not dividends I hear you scream .... being a loyal shareholder in a company that will never pay dividends (thats a Ponzi scheme) is a mugs game.
Endless "fundamental analysis" is for dilettantes - the only way to play SLR or any other gold company is by basic technical analysis - buy low, sell higher, "the trend is your friend" etc etc.
The legendary Ralph showed how it should be done - find some cheap assets, build them up, and then sell at the top and move on.
Him selling out of NST is equivalent to Packer selling channel 9 to Bond .... "you only get one bond in your life" he said laughing all the way to the bank.
Now RF GMD / SBM play is the equivalent of Packer buying Channel 9 back for less than a quarter of what he sold it for .... ' on ya Ralphie '
Unless SLR is part of a much bigger company that mimics NST, it simply isn't investment grade .... ditto RED and RSM, double ditto SBM, GDM.
So, consolidation or bust IMHO.
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