alternatives, page-8

A few problems here -

DT should have waited and dealt his hand from a position of strength. If he knows his stock and the gold market he could see that the stock was in the process of moving up with the rest of the gold sector. He didnt wait he rushed it out before he could even attach a letter to it, which was a move against existing shareholders to soften them up for the deal. Well it backfired - instead of the stock then breaking out naturally at which point he could claim the market likes the deal, it reversed against a rising gold sector. (Double negative)

The 600K breakfee is the only part of this deal I like as it has now put FML into play. I maintain that it may still turn out OK as the FOR SALE sign is now firmly in front of FML's Head office.

The Focus Minerals play has always been a cheap option on a rising gold price, who cares if it was breaking even at current gold prices, all the more upside. With a market cap of $180M for its land holding and operation its a steal.

All Management needed to do was hold it firm and run with the wind. We could be seeing a $2500 gold price within a year - that's a $200m extra profit from here. Capitalize that at a pe of 20 or more if gold stocks do what we expect. ALL management had to do was... Nothing.


Any intelligent fool can make things bigger and more complex. It takes a touch of genius – and a lot of courage to move in the opposite direction.
–Albert Einstein (taken from JS website today, how timely!)