the offer, page-7

Wow...unbelievable corporate finance games in broad daylight!!!

I cannot believe it!!!

Citi were the brokers who came out less than 4 months before the bid was presented and put a 50c target on DML based on their expectation of substantial cost increases that would render DML’s lead project as uneconomic in a receding Cu market.

First of all Cu is, and likely will remain to be, the lead industrial metal, second of all the backing to their claim was based on “other” African mining operations, not an actual review of DML’s in Botswana!!!

These guys must be coked up to their eye balls to show this audacity!!!

Now Citi and Mellisons have put together a reco to buy the co at $1.70 a share (340% over their most recent valuation).

If there was ever any doubt that these guys were crooks (as in the corporate finance universe), then this has absolutely put that to bed.

I just cannot believe this broad day light example. Unbelievable.




Timeline

23/02/2012 – Citi target - $1.60

01/06/2012 – Citi target - $0.50

21/09/2012 – Cathay and ChinaAfrica presents bid of $1.70 to DML (advised by Citi and Mellisons)




"Citi 28/08/2012 Sell $0.50

The broker suspects actual mining costs are going to come in much higher than guided given the high strip ratio of the company’s operations and the cost inflation present across African mining.

This means the Plutus Open-Pit may not end up being economically viable, as there might not be enough resource to underwrite the development plan. Uncertainty abounds and the Sell call is maintained."