Hi,I have no interest in RED. My interest is in a fund that owns...

Hi,

I have no interest in RED. My interest is in a fund that owns it and as part of that research I noticed their comment made yesterday that might be useful to holders. The EIM fund has fallen from $35m to $8.5m in the past year, so its under pressure. I have no idea whether that background affects their attitude to RED. They were accepting withdrawls from the fund based on the 35c rights issue price for RED. Not sure if that still holds.

You are in a tough situation - I hope it all works out for you in the end.

Cheers
Bleasby

http://www.eimcapital.com.au/portfoliodirect/daily_views.htm

5 April - Red 5 Finances Its Re-Start
Aspiring Philippines gold miner Red 5 (a constituent of the Emerging Resources Company Share Fund) moved to raise $60 million today with a highly discounted placement to institutional and sophisticated investors and a follow up share purchase plan. The previously advertised rights issue was abandoned because too many potential investors were concerned that the Philippines government had not yet signed off on a re-start of mining. Mining had been stopped after cracks had appeared in the wall of the tailings dam within a few weeks of he company hitting its production target for the first time. Red 5 directors opted to go with the heavily discounted offer to make sure they raised as much as they needed. With the capital raising out of the way, Red 5 would be set to begin production by the end of the year. In an international setting, gold miners trade at around $3,000 per oz of 2014 production. That would put the Red 5 share price at around 35 cents against a 10 cents issue price. There is value there but the company will have to get the go ahead from the government and might need some time to demonstrate it can get the job done operationally.

http://www.eimcapital.com.au/monthly%20reports/2013-07_ERCSF.pdf
Red 5 is proposing a discounted rights issue to fund a production restart at its Siana gold mine in the Philippines. The company is planning a transitional arrangement for the treatment of tailings that would permit production as early as October. The company has expressed confidence in its previous production and cost targets under the revised operating arrangements, marking it out as having some of the lowest cost production in the industry. The Fund’s holding has been revalued to the rights issue price. At the proposed issue price for the new shares, 2014 production would be valued at approximately one third of the average market price of international gold producers.