Yesterday I asked Lion selection for a statement; here is what I...

Yesterday I asked Lion selection for a statement; here is what I got:



Good Morning Michael,

Thank you for your email. Lion remains a firm supporter and shareholder of Lafayette. Robin Widdup Lion’s Managing Director is on the board of Lafayette and is closely involved in the companies progress. Just as importantly Lion has a firm belief in the Lafayette management team which to date has worked tirelessly to get the project back on track and in production. Yes there are a number of hurdles still to be achieved but we believe the management team at Lafayette has the ability to see these through.

In regards to the hedging position, there remains a substantial amount of mining ore reserves that are not hedged and remain leveraged to the spot markets. This along with the recent exploration announcements are encouraging signs of potential upside that remains with Lafayette.

In regards to Lion’s holding, it is 18.4% as you correctly pointed out and posted on our summary list as well as in the April 2007 quarterly released yesterday. The other two sources you mentioned were from the previous quarterly and annual reports which were from the pre-merger company (Lion Selection Group). During the April quarter Lion Selection Group and AuSelect merged. Both companies held Lafayette. The merged company Lion Selection Limited combined the two holdings and therefore now has an increased holding in Lafayette 18.4% from 13.5%.

Should you have any further queries please do not hesitate to contact myself or the team.


Regards,
Luke Smith
Investor Relations Manager
Lion Selection Limited
Level 4, 15 Queen Street, Melbourne Vic 3000
( Ph +61 3 9614 3980 | 7 Fax +61 3 9614 8009 | + [email protected] | ; www.afl.co.za




From: Michael
Sent: Wednesday, 30 May 2007 9:35 PM
To: LionSelectionGroup
Subject: Lafayette Mining


Dear Sir or Madam,

I belong to a smaller group of German investors, being invested in Lafayette Mining. After production has been commenced, Lafayette has lost nearly 50% of it's market-capitalization. Lion selection is one of the main shareholders of Lafayette. As posted on Your summary list, You are holding 18.4 % ( http://www.lionselection.com.au/PDFS/summary.pdf ). As posted in Your quarterly report there are only 13.5% ( http://www.lionselection.com.au/PDFS/AR-2006.pdf ). You can find the 13.5% also on the homepage from Lafayette ( http://www.lafayettemining.com/top_20 ). Aside from this ( is it a mistake in the summary list?), what does Lion selection think about Lafayette?!

Having a look at main discussion-boards (for example "Wallstreet-online" here in Germany or "Hotcopper" in Australia), many investors are afraid of, that Lafayette will not be able to get rid of their debts in the future and that Lafayette is bounded to hedged prices. There are no doubts, that it will need some time, to bring the production up to the predicted level but there are many doubts, that Lafayette can run out of money and shareholders will loose much money :-(

Sir or Madam, can You please mention, what are Your future expectations in terms of Lafayette?!?

Looking forward to Your reply,


Michael