salva:
Nice comeback for Pangea today. I'd sure like to know what was driving it. Very possibly the unhedged junior producers and good exploration companies are going to outperform the major producers from here on up in this bull move; however far it runs.
Regarding a takeover of Pangea; very unlikely, in my opinion. The reason is that Pangea has most of their properties JV'd with majors that can earn more than 50% of production by drilling, financing, and constructing the mine. Most majors, certainly Barrick and Anglo, wouldn't touch a company in which they were not in complete control of the properties.
I see Pangea as a smaller version of Euro/Franco Nevada; i.e., acquire good properties, JV them with solid major producers who are required to do all the heavy lifting to bring the property into production, maintain a very liquid, clean (no debt) balance sheet, and sit back and collect your share of the production and royalty checks. For the right price Pangea may sell a particular property, but I don't see them as a likely takeover candidate. Too many majors have the right to own over 50% of their properties, which would not sit well with potential suitors.
Terry |
