re: Ann: Caledon Acquisition Approved at Gene... Personally, I...

re: Ann: Caledon Acquisition Approved at Gene... Personally, I am fasinated by this particular asset on ORDs books. I have said it before, but I have assigned a zero value to it. Among other questions I need to sort out with ORD I am interested to know how ORD will 'carry' this. Will it be valued and recognised as an asset (financial)? Will it be revalued on a yearly basis?

The real worth to ORD is the price as which it sells the 'exercised' option. Again, I believe this will not occur until the proposition becomes such that:
- The asset rises by a min of 50% (I personally think the up-take will not occur until 100%)
- The min time at which this will occur is at least 2014+. CCD is still in early stages of moving to 'producer'.

The other difficult decision which must be weighing on ORDs mind is the cost. The cost today is not the cost tomorrow. Remember, however ORD decides to fund the purchase, it will most likely be from funds denominated in AUD. The AUD is trading strongly against GBP. There is a risk to the upside and downside that the effective purchase price will become more/less expensive. Additionally the amount ORD exercises is a min of 5% and and a max of 10%. It is discretionary.

All this aside it is a very real possibility assuming the asset does rise 100%-cum sale and 10% is taken-up, ORD will collect a $50MILL Profit. Thats 0.10c a share cash.