Value of VMC, page-5

On the reasonable assumption that RXL shares are fairly valued at their current price, 37.5c (and why not in this strong gold environment), then VMC shares at the current price around 19c represent extraordinary value. The numbers to support this are simply obtained...

VMC have 178 million shares on issue.
RXL are about to issue them 110 million of their shares. !!0 million x 37.5c = $41.25 million
$41.25 million / 178 million = 23.174c per VMC share

Add to this VMC's residual assets and other benefits of the deal : approx $6m cash and liquids, a very conservative estimate of $10m value on their remaining exploration assets, and $6.1m debt forgiveness (the value of this can not be understated as the removal of this item from their balance sheet effectively triples their net assets)... total $22.1m / 178m shares = 12.42c per VMC share.

Thus a fair value of VMC at 23.174 + 12.42 = 35.6c per share.

And, importantly, the difference to the current sp of 19c is not all just 'paper profits'. VMC shareholders will receive an effective dividend when the deal goes through of half of these RXL shares distributed to them individually in-specie, theirs to keep or dispose of as they see fit.

The implication of this for RXL shareholders is that if they swap their RXL shares for VMC at current prices, 37.5c and 19c, they receive RXL shares worth 23.174c for an outlay of 19c, plus receive all the other VMC assets and benefits as a free bonus.

I think I know what I would be doing!