chairman wayne mccrae shares the pain as trade

Chairman Wayne McCrae shares the pain as traders dump

Cudeco Tony Grant-Taylor From: The Courier-Mail August 24, 2010 12:01AM

Cudeco CEO Wayne McCrae holds a 15kg nugget of copper after their AGM on the Gold Coast in Queensland. Picture: David Sproule Source: The Daily Telegraph
THE continued slump in its shares, following Cloncurry copper hopeful Cudeco's resource update last week, has left the group's controversial executive chairman Wayne McCrae's piggy-bank looking a lot thinner than it was a few days ago.
Cudeco saw its shares savaged again yesterday, with the stock off another 42.5, nearly 20 per cent. When Cudeco halted trading in its shares last week ahead of its announcement of its latest resource figures, for which the market had waited four years, the stock stood at $4.79 each.

They closed yesterday at $1.705, off 19.95 per cent.

That meant the worth of Mr McCrae's holding in the company, having a market value of $60 million early last week, was down to under $21.5 million.

Traders have been dumping Cudeco's shares in large bundles since the announcement that put the group's resource, and worse the grade of its ore at way below the levels many investors had expected.

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As well as savaging the value of Mr McCrae's holding, and sending a large number of once-loyal shareholders running for the exits, the recent plunge in the price has also damaged Cudeco directly.

For some time, it has had a share buy-back program, under which it has bought back and cancelled more than two million shares at a total cost of nearly $9 million.

In the June quarter it bought back about one million shares at an average cost of $4.17 each.

In 2006, when Cudeco put out its last resource statement, Mr McCrae suggested it had made the world copper find of the decade, and the group's shares shot briefly from about 30 to $10.

But that resource figure was downgraded, at the stock exchange's insistence.

And last week's, although in a higher resource category, wasn't much bigger than the 2006 guesstimate.