Hi Goldnerd,I may be misreading your post, apologies if this is...

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ryan0

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04/01/22

17:26

Post #: 58636747
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Originally posted by goldnerd: ↑

In terms of an immediate re-evaluation to Lion's Pani interest based on the recently announced transaction a simplistic valuation could be:

Merdeka has paid US$80.16m for a 50.1% interest in the Pani COW. This values the entire 2.3 Moz deposit at about US$160m or A$220m. On a per oz basis this equates to A$95.7 per oz.
Assuming the Pani IUP oz are valued the same way, this would value the entire deposit at A$227m (2.37 Moz @ A$95.7 per oz).
Lions share would equate to 33.3% of $227m or A$75.5m. This is just over $12.2m above the present valuation of A$63,3m or an increase of about $0.08 per share.

Friday's share price action seems to support the above in that the share price increased $0.085. One can make the argument that the Pani IUP deposit is the more valuable of the two and has much greater scope for an increase in overall oz, making the above valuation very conservative.

In addition to this its the ongoing progress and news flow going forward which will hopefully see the share price start to reflect and possibly even exceed the full NAV per share which should now exceed $0.70 per share.

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Hi Goldnerd,

I may be misreading your post, apologies if this is the case, however, I have a different interpretation of this transaction.

LSX owns 33.3 % of the Pani joint venture(2.37m oz resource) with Meridika holding 66.7%.
J Resources has sold its neighbouring resource (2.3m oz) to GSM who is a subsidiary of Provident.
This will allow the combining of the two resources into one ownership group, however, I do not see that LSX will own 33% of the combined resource as you suggest in your valuation.

My rough understanding is the combined entity will have the following ownership LSX 20%, GSM 40% and Meridika 40% (I understand Meridika now control 50.1% of GSM)

LSX's Pani revaluation could be revised to reflect the price paid by GSM for the J Resources resource. I haven't seen the $ made public.
Also, the link zone that is created by combining the two resources has the potential to greatly increase the size of the overall resource.
Both should be positive for LSX's valuation.

Happy to be corrected if I have anything wrong.
LSX Price at posting: 56.0¢ Sentiment: Buy Disclosure: Held
2 Upvote

0 Great analysis

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