If it was a value accretive acquisition, you should be able to not only maintain the dividend, but increase the dividend. I've seen it many times and it reinforces confidence in the mgmt team and their acquisition acumen.
A doubling in cash costs is very concerning. Sure, it's still attractive margins but dude, their diligence was off by 100%. This is primarily due to grades. We haven't been provided details of impacts on fuel prices but most companies hedge this sort of exposure.
If the technical due diligence couldn't identity the grade issues 12 months out into the future, how confident are you of their analysis on the resource extension opportunities that is integral to extracting value from this acquisition...as we know the current reserves don't support the acquisition price on an economic basis.
I've always said this acq was a big gamble on copper prices and now we need copper prices to perform even stronger. Do remember we outbid the other big players, so maybe there is a reason why we did that...in all the hysteria of copper prices. Was it because we knew more than them and we could outbid or was it that they couldn't see the value in bidding higher? So far, it looks the latter.
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