I'm not so sure it's a confused strategy but more of a flexible opportunistic strategy, if the opportunity is there for M&A at a good price then fine, if not, cut your losses and keep cash on hand for future expansion, M&A and/or exploration.
Wayne Bramwell was quite clear in that he would do transactions at the "right price" so the only danger in that is that the assumptions about what constitutes the right price may no longer be right as capital gets more expensive, costs escalate, competition for ounces in the ground increase, costs of contraction and operation escalate, and other more left field externalities such as taxes and native title might change.
The guys at Money of Mine have been perceptive that it's easier and cheaper to buy ounces in the ground rather than find them but my question is what happens when all the "easy to buy" ounces are taken then the quality and quantity of remaining ounces deteriorates and they get deeper, lower grade and further away from existing mills.
That's when brownfield and greenfields exploration will explode, and the cost of doing it will also explode.
WGX Price at posting:
$1.63 Sentiment: Hold Disclosure: Held
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