I do agree that the first offer is not normally the best offer and I have no way of knowing how to calculate a resource value based on no numbers ie. DFS, capex etc besides some rubbery figures thrown around. Secondly, I am a follower of price (retail mug) not a price maker (major holders) so I study price then decide how to make the view.
Thirdly valuation is a very elastic feature reflecting all sorts of conditions from the industry to the oversight global macro economy. I was at AMEC listening to struggling explorers with good story/fundamentals looking to raise capital to fund their projects. Equity is not an option for the majority and neither is it through the corporate bond market. Think China? In fact the only ones that are more realistic start small scale mining then fund expansion through cash flow. The 'foot in the door' rather than diving straight into the Boss's chair.
Pre-TO, it was trading $1.28. Have a look at its peers GXY ORE PLS AJM at the time and compare to present. This sector is struggling and obviously WES made an opportunistic offer. This is either a signal for the sector to hit bottoms or tops. All relative to market or sector index?
You massive capital gain just got a boost and at one stage the latest new kid on the block PLS also had holders thinking mining was the start of the next exponential rise in their investment.
KDR Price at posting:
$1.89 Sentiment: None Disclosure: Held
