$40 cents club, page-961

RED's hedge book at around an A$200m mark to market loss is starting to look like a huge issue with regards to the benefit of the merger/takeover. If the gold price continues to increase ther soon won't be enough SLR cash to close out the hedge book and undertake the KOTH cut-back and mill expansion. SLR's hedge book is only a mark to market loss of around $25M. Consequently, to justify the rationale behind the merger (early expansion of KOTH production) many of these hedges are going to have to be worked through depressing the combined entities share price relative to its peers for up to 3 years.