second bite at the cherry

TIR has copped a bit of a hiding in the last six months, and TIR holders may justifiably feel beleaguered, if not outright depressed.

Now, you may take this post as a positive, or as a negative, but I thought I’d let you in on something that I have uncovered, anyway.

TIR management sold the Radio Hill mine, infrastructure, and surrounding tenements for only $1M or so, a few years back to FXR. TIR management may be excused to some degree as they may not have been able to foresee that they were selling at the very bottom of the cycle. Nonetheless, the cycle has well and truly turned, and FXR seems to be making a good show of the former-TIR assets.

Moreover, the Radio Hill Disseminated resource plus the surrounding tenements at Whundo, and Sholl, seem to have become particularly attractive on the back of TIR’s own $14M worth of work, through its Bioheap subsidiary. (Oh, the irony!) Anyway, I’ve done some back-of-envelope calcs that show such, and they are pretty eye-opening. As an FXR holder, I’m pretty excited by this. That said, I’m also very frustrated that the market does not seem to be valuing FXR appropriately, given the numbers involved. Regardless, it seems pretty clear from the analysis that I have done that the market will re-rate FXR “sometime”. Of course, when “sometime” is is the great unknowable.

TIR holders may be interested in viewing my number-crunching:


http://www.hotcopper.com.au/post_thread.asp?fid=1&tid=214288#656350


Now, please, don’t take that as an FXR holder gloating “look what your TIR management walked away from”. I pass that thread on as a possible mutual help situation. When the market gets around to appreciating what FXR is sitting on, and re-rates them, then TIR holders that also have FXR may be able to (a) obtain some relief from the savaging received by TIR over the last six months, and (b) take a second bite at the cherry, of valuable assets left on the table when TIR sold everything so cheaply and walked away from the Pilbara.

My interest in this is simple: I’m an FXR holder, and my holdings have copped a bit of a battering, too, in the last couple of months. That’s not because of the operations, their economics, or any metallurgical or technical “glitches”, rather, the former management regime lost focus, and the price has slid well below what I came in at. Obviously, I want to see the price go up to where I think it represents fairer value. That that will happen, I have no doubt – it’s just a matter of “when”. So to that end, I have a vested interest in getting TIR holders to take another look at the FXR assets. Therefore, take everything that I say with a grain of salt. That said, the calcs were done conservatively, for the benefit of myself, and “Pedrof”. I never intended to spread them around to TIR holders, but they’ve come out so nicely it makes sense to let TIR holders in on it. Use whatever assumptions you like to do your own number crunching if you like.

So, would TIR holders want to take a look at the upside I have identified in their former-assets?
Make up your own mind.