Hi BeserkWarriorI agree with you that it makes a lot of sense...

Hi BeserkWarrior

I agree with you that it makes a lot of sense for Wattle Dam ore to be treated at AAR's proposed new plant. The AAR ore is lower grade so the high-grade Wattle Dam ore may be beneficial for blending purposes.

It makes sense for MXR to attempt to increase the resources at Wattle Dam so that they can negotiate a better outcome with AAR. A merger makes sense as both AAR and MXR are gold explorers/developers in the same region. The ratio of ownership AAR versus MXR will obviously depend on MXR's drilling success at Wattle Dam. Of course MXR also has the Li projects so depending on the success of drilling at these, MXR may opt to sell off Wattle Dam outright and remain listed with their remaining Li/Ni/Au assets.

Lots of possible outcomes however IMO whatever the final outcome MXR offers an attractive risk versus reward at current market cap of approx. $13 million (this is less than $50/oz of Au resource). It is one of my largest holdings based on my assessment of the value offered (DYOR).

Just as an aside, IMO we may see a pick-up in merger activity of these smaller explorers. It's currently getting more difficult to raise capital so it makes sense to merge with other co's with complementary projects to achieve critical mass - for example, BTR just announced a takeover offer for AME.

GLTA & DYOR