I agree the transaction makes sense. Discounting for what appears now to be a hefty CAPEX bill I would think that something in the range of 35 to 45 cents would be fair and reasonable.
Cuddingwarra for mine won't be able to provide the tonnages on known resources to provide enough near-surface ore to be able to facilitate a staged production start-up in the same way I'd first envisaged... Ergo more capital required upfront to get the underground operantions into production, and a discounted in-ground present day value for the ore.
On the flip side the AAG/WGR merged entity still doesn't have the infrastructure for CMGP so I'd like to think AAG board also have been considering merging with RMS or SLR (or at least explored these options) who have mills and spare capacity. Has this happened? I doubt it but you never know.
Rover field looks exciting also and for those that haven't read up on it yet I suggest it's definitely worth a look.
JT
AAG Price at posting:
28.0¢ Sentiment: Buy Disclosure: Held
