There would be a huge cash pile of around $850-900m held by RRL...

There would be a huge cash pile of around $850-900m held by RRL (inclusive of retained earnings from the latest quarter) if Anglo top their bid . That is around $1.13-1.20 per share. The current share price is $2.79, so if the deal falls through the non-cash component would be valued by the market at $1.59-1.66 per share or $1.193-1.245 billion for a miner with around 350k annual production and a significant shovel ready project awaiting government approvals. RRL's share price would look cheap even when you factor in the significant hedging at low prices and relatively low mine life at Duketon that has the potential for mine life extension.

I think that if the deal falls over then RRL's share price will head higher, so long as the AUD POG does not tank, and they will not need to raise funds for the McP project when approval is given.

The one concern is that the management might splurge the surplus cash on another less profitable project.

Shareholders should not blame the current management for all of RRLs failings - past management decided not to spend on exploration (mine life extension) and acquisitions but instead hedged its production at low prices while handing out large dividends that were not sustainable given the failure to clear the hedges as the gold price rose.

loki