Let me tell you a story about a stock I owned until recently called PNA. I was a shareholder of PNA for a number of years and it was a great investment with a lot of upside potential. We shareholders got very excited when PNA bought the Frieda River recently, a world class undeveloped copper and gold resource that would have kept PNA busy for the next 20 years.
A few years ago, they let a chinese group invest in the company and they got 17% of the company. Everything was great until price of copper took a dive and these friendly investors made an offer to buy PNA at $2:30, board rejected their offer and things went back to normal. Copper prices fell a bit more and PNA share price fell as well. The friendly investor made another cheaper offer and this time we got taken out for $1.85.
PNA had resources in Laos, Chile and PNG and was the best pure copper play in Australia with gold and silver as the icing on the cake sort of speak.
The question to ask is? What is stopping our friendly chinese investors doing the same with FML? They already own half, what is keeping them from getting the rest of the company?
Cheers
FML Price at posting:
36.5¢ Sentiment: None Disclosure: Held
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