Hi All,I have concern if the deal of selling IGC's 15% interest...

Hi All,

I have concern if the deal of selling IGC's 15% interest in the South Africa platinum mine do go ahead, IGC will effectively become a shell company without any mining asset sitting on some cash. This explain why the share markets is heavily discounting the share price of IGC (currently at 22 cents).

To explain why the share price is heavily discounted compares to their cash they are expecting to receieve, you need to looks at CFE which belong to the same group, their situation is almost the same, last year CFE sold the Cape Lambert iron ore project to the Chinese for 400 millions, after a return of capital at 21.7 cents per share, the share is still trading way below from it high from last year. They did create some mirage by buying some interest on an African mine and acquire some former Copperco asset but they can never hide away some dodgy deal by the MD to loan money to his mate and I will predict the money will never get return or some how got loss and write off as bad debt. This explain why CFE have so much potential and with a lot of cash, they are well positioned in the financial storm to acquire some premium quality mining asset, but instead they can only managed to stay up and down with the share market without any significant return to the shareholder value.

Judging from the performance of CFE, I can almost certain to predict the IGc will follow the same path because IGC is managed by the same management, after the deal, IGC will sit on a small pile of cash and they will acquire some mining asset because they cannot sit on their butt and do nothing, if they are lucky, they will find something in the mine and move on to the next sale of asset project. In between while all this is happening, you will notice there maybe some loan going out of IGC to some private company and the money never get return! not to mentioned the director expense on travel and high director fee every year, the management will suck the company dry before you knew it.

In my opinion, I don't mind the company selling the asset at a good price, but they have to return those value to the shareholder, when I brought IGC, I am based on the option agreement between NKP and IGC that there is a take over bid for about 39 cents. I invested the money and will get 39 cents in time when the deal is done. But the management is so incompetent and their negotiation skill is so poor, first when strike the deal with the deal, platinium price is at around 800-900 USD an ounce and they use the lower end of independent expert valuation to do the deal, now the platinum price is bounced back to USD 1250 an ounce and the mangement still allow the deal to go thru at the same price of 60 millions AUD, in my view the management failed to negotiate a better deal for the shareholder, they should negotiate the sale price up substantially but they didn't. Secondly the management allow the term of the agreement from a takeover bid for the company to change to an asset sale situation, this is a 180 degree change because most of shareholder belive that they will get at least 39 cents per share for their share and now the share price is sitting at 22 cents doing nothing, if the shareholder want to sell their share, most of them will incure loss because some brought the share at higher price (around 40-50 cents). There are so many questions in my mind why the management to allow the deal to go thru like this, consider there are so many interrelationship between the IGC and NKP directors, it make me feel that the management of IGC is doing the deal for their own best interest not for the shareholder interest.

I would like to get the opinion from all of you that if IGC is selling their one and only one mining asset and turn the company into a shell company. Do they still need to follow the ASX's listing rule to get the shareholder approval on this, if so why didn't they seek shareholder approval. OZ Mineral recently sell most its asset to Chinese Minmetals, they still need shareholder approval on the sale not to mention there are lot of other example that asset sell requires shareholder approval. One thing get me really suspicious is since Tueday's announcement came out I have raised my question to IGC directly, the enquiry got pickup by a Public Realtions company and a few guy call me back and I never get a definite answer on whether the deal require shareholder aproval, the enquiry is bouncing from one person to another. I also contacted ASX regarding the matter and sent a formal email as ASX required on Wednesday and up until now I still havn't received a reply on my question. As the day go by, I can smell something bad is brewing and I am not sure what is going on!

Can I get some opinions from you on my views on the current situation? Thanks!

Ray