Hi Tokyo, good to see you back on board.Takeovers, hmmm an...

Hi Tokyo, good to see you back on board.

Takeovers, hmmm an interesting perspective for RED. Its a totally undervalued company, will be in production at the rate of 100,000 ozs within 3 years of start up, long life, low cost. A perfect takeover candidate at some stage.

We have had that discussion on the RED threads before, with consensus agreeing that it would be a fantastic complement in particular to MML which after all is also Philippines focussed, and only resides about 150 kms away. And with MML at a premium, it would make financial sense for MML to declare a scrip only bid. But its unlikely due to the past association that Geoff Davis has had with the management at RED.

I think from a wider perspective, RED will become more attractive once it gets much closer to production, for any bigger player, but by then I would expect that the market will have re-rated RED anyways, and so the opportunity that exists now for corporate takeover activity will vanish down the track with that re-rating.

I'm therefore now of the view that RED will out-perform the market in the following 6 - 12 months through its own price re-rating, so although a takeover is a possibility its probably unlikely to happen within the timeframe we would hope one is offered. Just my view of course.

IF Mapawa continues to perform then it would be a logical reason for a much bigger player to show considerable interest - we already know that Anglogold was interested some years back but I think that deal has fallen over now and Anglo can't get back in at the giveaway price they had offered for direct project exposure.