Gmd assets are far from great, purely a vehicle and everyone knows. Yes there is a high grade shoot at Ulysses but it won’t sustain 80koz a year for very long. Valuation without RF but with DCN assets is likely $265mil ($140m for R&R, $75mil cash, $50mil infra) - this would be the technical Val. The market factor Val is therefore plus $300mil (ie RF). An independent valuer would have to acknowledge this as per their reporting criteria. A remodel of the Ulysses UG may reveal an over estimation of gold, in my view, which is the reason it never progressed earlier, the sbm board should have had this asset modelled and stress tested given it’s been used as a lever in this deal. Sbm shareholders should be demanding an independent report of the gmd assets value which is likely being strategically avoided. SLR is easier to value because they produce cash and have stated reserves.
SBM Price at posting:
58.5¢ Sentiment: None Disclosure: Not Held
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