RNS/EMR Arbitrage., page-6

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gyro gearloose

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19/05/16

21:31

Post #: 17818107
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Originally posted by Min123 ↑

Figures from the RNS presentation suggests an arbitrage opportunity.

1. After EMR has funded the Okvau definitive feasibility study(DFS) and the exploration programme (total cost of approx. A$14m), both EMR and RNS will have approx. $4m each in free cash.
2. EMR has a market cap. of $58.8m (at current price of 4.5c) and RNS has a market cap. of $29.3m (at current price of 5.1c).
3. Based on points 1 & 2, EMR has an enterprise value of $54.8m and RNS has an enterprise value of $25.3m
4. At the completion of the DFS, EMR’s share of the Okvau resource will be 561k ozs of gold(51%) and RNS’s share will be 539k ozs(49%).
5. Based on points 3 & 4, EMR is valued at A$98/resource oz and RNS a$47/resource oz.
6. Based on point 5 and with EMR at 4.5c/share, RNS should be trading at 10.6c/share.
7. A high quality exploration programme has just started which has the capacity of adding substantially to the resource base. Initial results should be available in approx. 6 weeks.
8. The existing resource base is very good quality and deserves a higher valuation/oz than is currently the case.

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Thanks min123,that helps clear up the emr,rns share of the proposal.I need to do further research on this one.The support of the Cambodian gov is an important aspect to this project.IMO

RNS Price at posting: 5.0¢ Sentiment: None Disclosure: Held
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0 Great analysis

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RNS/EMR Arbitrage., page-6

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