GoochI own some CGX. Been in since 2009.I can assure you that...

Gooch

I own some CGX. Been in since 2009.

I can assure you that this article is not correct.

CGX is producing at 200k ounces pa. However, due to a malfunction to their sag mill production was way down in the last 2 quarters of 2011.

They have over 8 million ounce reserve/resource. However it is a low grade deposit (average around 1 gm/tonne), and there is some hedging remaining to early 2014.

CGX is finalising plans to up production to 300k ounces pa at a capital cost of $130m, which could be funded from cashflow. Tax holiday has several more years to run.

They have over $100m in cash, and a smallish loan left. They could clear the loan and hedge with their cash.

It is a crappy takeover deal for CGX shareholders and I hope it fails or someone else makes a better offer. The management has gotten lazy and wants out - they have options that would be in the money under the proposed takeover.

B2Gold is way over-valued for a producer of 150k ounces pa (going to around 450k in 2016 if all their plans work out). Their management has a history of successful deal making having sold a mine in Russia to Kinros for $CAD3 billion before the GFC (I think), therefore their company share price has a premium over most other goldies. I think PRU, RSG, MML, CGX are all cheap relative to B2Gold.

I think AMX will get taken over because it is too attractive to leave until they have developed a mine.

loki