If Wei An were willing to sell to RSG at 16 cents/share then you can be 100% certain that it is a superior deal to what they faced from Z. Options are just - that options can be renegotiated, which would be certain to happen given the history of NMG and how the Chinese deal with our small companies.
I agree that NMG shareholders are not getting a great deal from RSG. However it gives NMG shareholders the chance to maintain their shareholding and I think that there will be a strong opportunity for RSG to arrange for a change of senior management at NMG.
IMO turning around the NMG operations is a lot more complex than simply getting a crusher fixed. A lot of managerial skill is required to move some 3,000 villagers in order to be able to gain access to the main pit. The cost of moving the villagers and clearing the over-burden is high, about $80-100m. Do you really believe the current management would do this within budget and timelines given the crusher still is not operational and will not be for several months and given the amount that has been sunk into this project to date?
I guess it is your money so vote which ever way you feel is right for you. I do not hold any RSG shares and am out of NMG so it is no skin off my nose. I just have some strong opinions having watched this company as an investor and having done more research after I woke up to the fact that this is not the simple project it was claimed to be. Some months ago an ex-CEO of a west African company told me he would not want to develop their mine. Other problems of operating in Ghana include vast over-manning and very poor maintenance of plant and equipment by local contractors, which means management has to be very good to overcome such issues.
In an earlier post I mentioned that NMG spent over $5m in the last quarter on admin expenses. In comparison, PRU spent only $2.3m on admin while actually producing 50,000 ounces of gold in those 3 months.
I am hopeful the NMG Chairman sees things as they are rather than what he may wish for, and takes decisive action that will stop the bleeding for shareholders. Perhaps he can negotiate a better deal with RSG than what the CEO has obtained.
Good luck.
loki
NMG Price at posting:
13.0¢ Sentiment: None Disclosure: Not Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)