The truth is despite the fact that we talk about it, many of us don't recognise the upside of Vburg. If we agree that as per Ambrian analysis fair value for Modder East ( excluding potential reserve upgrades ) is 1.5x NPV than ME is 70.5. Add the 8 cents for Goliath and the acquirer buys Vburg for free if they pay 80 cents. To be fair we should minus the CN which can be puchsased back if the issue price trades above 57 VWAP for 20 days . So let's call it 72 cents. Ambrian so state in their report at NAV x 2 is also possible and they use this metric to value other companies Now this is what's interesting. Vburg is at least another ME, likely better. Gold mines with figures like Vburg ( sub 400 cash costs) are very rare. So Vburg potentially is worth 80-100. Then we have modder North and the other assets The other intersting piece Is the Goliath ounces are valued at 5 dollar per oz. The Chinese have always bought strategically , positioning themselves 5-10 years out. This value should not be underestimated as we all keep referring to a 1.50-170 value which is true assuming no megamine development. Progressing the asset wil add value in the hundred of millions. So this is why a 70-80 cent offer is too low from even a 3 month timeframe. It would need to be close to a dollar now and definitely 1 dollar plus lost Vburg pre feas. And to think I though the poster was ramping when they said a few weeks ago wouldn't sell sub 1.50
GDO Price at posting:
50.0¢ Sentiment: None Disclosure: Held
