Ann: Takeover - extension of offer period, page-15

Volume over the last 4 or 5 months has primarily been arbs - high frequency traders and event-driven funds.

Until this week the arbs held about 5 to 6% of TIE - spread among fifteen to twenty funds all over the world.

Most of the arbs are small funds managing less than $500 million.

The stock held by the arbs is the only “loose” stock on the entire share register.

On Monday and Tuesday this week we saw high volumes as certain arb funds capitulated (realised that Zhao Jin is either unlikely to raise its offer or will allow its offer to lapse) and sold into the screen.

In fact, Zhao Jin extended its offer - but their bid is largely an irrelevance to the performance of the share price now, and I believe that after a year it has to lapse anyway.

One of the largest (and certainly the most aggressive and most levered) active funds in Australia bought most of the volume this week.

This fund is the largest brokerage commission income source in the Australian market: their market power is such that they can “suggest” that brokers persuade other institutional funds to buy a stock once this fund is “set”.

In an extraordinarily strong gold market we now have a good chance of de-coupling from the bid price.

It is extremely encouraging that the company is embarking on a serious exploration program – both at Abujar, and in other areas – should give some very nice blue sky.

I hope our friend Gwaihir doesn't mind me copying and pasting his excellent post - just to remind the slower ones of you what we are talking about with all this good news.

Gold is at US$2,254 - TIE are printing money at this price, they'll pay off the mine in 6 months and the rest will be accumulated pure profits from then on, at about US$1,250 an ounce profit above AISC, and more.

At 170,000 ounces per year, that is revenue of almost US$400 million, and profit after AISC of about US$220 million (AUD$340 million).

Anybody here for a special dividend in the not too distant future?

So relax, girls – stop agonising, lay back, enjoy the ride and buy more shares.