Ann: Explaurum Takeover Update, page-25

Icey - I agree with your ruminations.

If I were an ALK holder I would be concerned that my company had overpaid for a non-controlling share of Explaurum. Compared to the original Ramelius bid Alkane paid a 9% premium but now with the chance that Ramelius will walk away the premium is closer to 50% of the EXU shareprice. I doubt Alkane has the substance to takeover Explaurum and then to absorb and develop Tampia without Alkane going heavily into debt or diluting ALK shares. If Alkane sees its investment in Explaurum solely as a passive investment then ALK shareholders can expect to have to wait several years for there to be a positive return on that investment.

If I were an EXU holder I would be looking at three options. If Explaurum retains the lead in developing Tampia then I would be expecting significant dilution of my shares, a substantial trough in the EXU share price and several years of angst as the company moves through funding, developing and commissioning the plant at Tampia. Don't get me wrong, I have done that with numerous junior miners and it is what I expect many current EXU holders are actively seeking to do. The second option is to vote in favour of the ALK bid. That would get Explaurum through a short term need for cash but I don't see the Alkane bid changing things much in the longer term. As I indicated above, I think the move by Alkane was imprudent and poorly thought through but it does have some advantage for Explaurum and EXU holders (putting off the coming dilution by several months and defeating the Ramelius move). The third option is to reject the ALK bid and take up the RMS bid. That would surely be the most secure option (but possibly not the buzz that EXU shareholders are looking for).

I am a RMS holder and I am of the view that Ramelius suddenly jumped into action with regards Tampia as it wanted quick access to the Mace deposit for trucking to Edna May, to fix a short to medium term problem. If Mace is not as prospective as they thought it was going to be then I can understand why they have backed down. As for the rest of Tampia I think the Ramelius intention was to develop a stand alone plant on site. Seeing that that is what Explaurum intends to do anyway there is less urgency for Rameilius to act and particularly if Alkane gets a blocking stake in Explaurum Ramelius has time on its side. It may well be that in coming months Explaurum and Alkane are more motivated in doing a deal with Ramelius. Clearly Ramelius sees that the region between Edna May and Tampia as being a possible province for them to operate in but they can bide their time with regards Tampia.