sbs holds currently 48% of asmara

which is a Gold project, which could hold up to 3 mill or more ounces according to posters.

SGC, the operator is proposing to take over the 48% by offering SGC shares. Directors, because of their reputed 65 mill shares can block this as well as shareholders at a Meeting to be set aside for this.

The shares of SGC continue to rise and last night rose 16.1% or 36 cents to CAN$2.60.

SGC whose main project is Asmara, can therefore afford to be generous, IMHO.

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CALCULATIONS

SBS has 303 mill shares and 26 mill pp shares, paid to virtually nothing.

If a takeover is successful, one can expect SBS directors to change their pp shares for possible SGC pp shares. Put value at 5 mill fp shares

The total number of shares now is 308 mill, share price is 8.8 cents or Market Cap is $A27.104 mill.

That is very little for a 48% stake. Even doubling that brings it only to $A54 mill.

I don't know the amount of Gold in that project, but the share price of SGC would'nt have risen from CAN$1.51 to CAN$2.60 since 11 Jan. 2006 unless it was significant:

http://bigcharts.marketwatch.com/javachart/javachart.asp?symb=CA%3ASGC&time=&freq=

It is quite possible that the takeover offer for SBS 48% holding ought to be for at least 3 times the 8.8 cents share price, say 25 cents per SBS share IMHO.

As the shareholders and directors have the last say, I can't see them accepting a very low offer.

That is my opinion.

Subject to audit,

Gerry
Readers, please do your own research and you decide if and when to buy, hold or sell any stocks or metals/commodities.