ConsMin sniper keeping his powder dry - Dryblower Monday, 2 July...

ConsMin sniper keeping his powder dry - Dryblower


Monday, 2 July 2007


IF WORDS were bullets in the battle for Consolidated Minerals, Dryblower reckons Brian Gilbertson and his friends on the company's board have already won.


The reason for this assessment is simple.

Since Gilbo announced his plan on February 23 for a complex merger of Pallinghurst Resources and ConsMin, he has fired off more words than a machine-gunner at the Somme.

Precisely how many is anyone's guess, but Dryblower did a page count over the weekend and came up with 564.

That's right, one simple merger and, so far, 564 pages of documents, statements, explanations and reviews – and that's not counting announcements dealing with director resignations.

The bulk of the words are contained in the original, and utterly ridiculous, 443-page scheme of arrangement booklet, followed by last week's 60-page supplementary booklet.

Gilbo's nemesis, however, the normally verbose Michael Kiernan, has been surprisingly light on for words, filing a four-page proposal to bid and, so far, using his words more like a sniper than a machine-gunner.

Unless Dryblower is more mistaken than usual that situation will change as we get closer to July 19, the date of the all-important shareholder's meeting to vote on Gilbo's proposed monster merger.

As each day ticks by an opportunity is created for the sniper in the trees to take pot shots at the marriage of Pallinghurst and ConsMin.

A couple of shots have already been taken, neither stopping the 564-page rhino in its tracks yet.

But, there's more to come as July 19 gets closer.

First shot is likely to be an enhancement of the terms of Kiernan's proposed merged of ConsMin with his Territory Resources.

Then he can pop off a few reminders about who's in his camp – two of ConsMin's major shareholders.

Then we have another director resignation, taking men overboard at ConsMin to three since Pallinghurst fired off its first shots in the war.

Then Kiernan might care to probe more carefully into the question of timing about a rise in the price of manganese.

More specifically, exactly when did ConsMin know that the manganese price had risen sharply.

From what Dryblower is hearing some ConsMin shareholders are rather unhappy that they were not told earlier about the manganese price effectively doubling from $US3.55 a pound in the second half of 2007 to around $US7.50/lb over the next half year.

It's always a difficult issue of establishing exactly who knew what, when, and whether it was official and therefore needed to be reported.

However, a friend of Dryblower's was having a chat with the retiring chief executive of BHP Billiton, Chip Goodyear, on June 14 and it was Chip who volunteered a comment about the manganese price doubling.

What becomes interesting is to marry that snippet from Chip with the ConsMin share price.

On June 14 the stock closed at $2.80. Five trading days later it had dipped to $2.65, only a 15c fall, but for a big share trader a 5% decline can be the difference between a small loss and a big loss – if trading between those times.

It isn't just Dryblower looking at those trading details, and the dates between which people like Goodyear were mentioning the manganese price and ConsMin was officially reporting it – a gap of 11 days, which was actually only seven trading days after allowing for two weekends.

For a sniper, the number of days is probably irrelevant. A gap, any gap, provides room for a pot shot – and one which could prove very painful.

By now you get the picture.

Gilbo and friends have fired off an awful lot of ammunition, 564-pages of it.

Kiernan is sitting in a tree somewhere (poor tree!) and loading up his sniper's rifle with sufficient rounds for 17 days of pot-shots – some of which will miss, but others which might hit some very painful parts.