As one shareholder of a company involved in an Indonesian gold exploration company, I commiserate with Bre-X shareholders over the recent turn of events affecting you. Bre-X has been a success story by which all other companies have been measured. To witness the disappointment and angst that has arisen so suddenly in the short time of this past week has rocked everyone's confidence and served to elicit sober assessments by us all.
I personally regret the immediate losses experienced by new shareholders having entered Bre-X in recent weeks. I hope many others of you have gotten out your costs during the period of fantastic share price appreciation. And there are those of you, who I'm certain have maintained a diversity in your holdings to avoid the full brunt of a blow such as has occurred.
I'm a firm believer that one can sustain great losses and come back to see better days. My personal investing over 30 years has provided me with both kinds of experiences. Having just come off of a spate of misfortune, two bad years in '95 and '96...while I paid my tuition for lessons on investing in the Canadian markets...I would like to share with you the knowledge of an opportunity I am convinced will reverse my fortunes in 1997. Each of you possessing liquidity can partake of this same opportunity. It is another junior exploration company that has diversified its asset base through a gold producing property in Zimbabwe, the acquisition of an exciting and promising property in Sumatra, and ownership of perhaps the world's most technologically sophisticated gold extraction company in the world. I am referring to Antares Exploration and Mining (ANZ, Toronto) that currently is trading in the C$2.00 range having recently been as high as C$4.30.
I have personally been told by an individual in the IR department of Coleville Resources (JV partner to Antares) that a report by Strathcona...the same engineering firm that has dashed cold water on Bre-X's hopes and expectations in the Busang...that the Ojolali probably has at least 20,000,000 ounces of gold.
Those of you who wish to regain recent paper losses sustained in your Bre-X holdings have this oppotunity to enter a new play that could provide the same kind of runaway share price that Bre-X experienced in late 1995 and the first half of 1996. Antares shares are currently undervalued because the reserves in the Ojolali aren't proven, their new acquisition of Rappa is not fully understood by the market, and their Lady Lina mine in Zimbabwe has been operating for a relatively short time.
A consortium of five banks recently underwrote Antares to the tune of $25,000,000 based on their privilege of being able to assess Antares business plan and prospects...and...the confidential engineering reports the public has not had the opportunity to see. More than likely Antares at this time will use some of this funding to buy back shares from the public by outright purchases in the open market which is now in tatters due to the Bre-X calamity.
If you want to sit around and mope about the misfortune of Bre-X until it resumes trading, you will probably have much to feel miserable about for perhaps months. However, if you have the inclination and means to sieze a new opprtunity, one that will excite you and provide you with appreciable capital gains, then consider Antares. If the company management proves confident enough to buy their own shares, then you have an unmistakeable telltale that ANZ shares belong in your portfolio. Be on the lookout for such an action by ANZ, and act swiftly. I don't expect it to be a C$2 stock for long.
I personally expect Antares to appreciate tenfold in the remainder of 1997 from its present level.
Forgive me if it appears I'm dancing on a grave, but Bre-X has only suffered a setback. It is not destroyed. It's future is just less certain. I feel you will find Antares refreshing and a positive new focus.
Sincerely,
Don DeKold |
