Point form synopsis of J.K.'s latest report on BGI dated Nov. 2, 1999
- deadline passed (October 29) without formal closing;
- both parties still working in good faith towards closing the deal;
- Ashanti replaced (initial) paperwork with a simpler, internally generated, agreement;
- expected to take a couple weeks to fine tune agreement;
- Birim cannot, in good faith, solicit deals with other companies nor extort better terms out of Ashanti;
- must also consider any other proposals presented on an 'unsolicited basis';
- Ashanti needs to keep Arunfuryi mine open and Ghana government happy;
- gives the Mampon deal more weight than its actual value would seem to justify;
- Arunfuryi to run out of ore shortly and would lay off 1,900 workers;
- nobody, with a stake in Ghana, would dream of upsetting apple cart of Birim/Ashanti deal;
- strong buyer(s) through Wood Gundy at $0.36 is almost filled;
- no disguise about size of interest nor monkey business with market;
- ergo, Birim attracting solid investors with a long term strategy;
- a very good deal for Birim - likely only recognized some time next year.
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My comments:
Look for more serious buyers (200,000+ shares) of BGI shares. Once selling abates, bids will rise to get even more shares.
Look for a deal re: Goboso shortly after Ashanti makes the first advance.
Seeing several large houses talking about $375 gold in the near future. If this happens, it would be very good for BGI as it would not only expand the 'mineable resource', and therefore the advances from Ashanti, but it will ultimately get BGI another $10.00 more per ounce of recovered gold from the properties concerned.
Based on the above, I view it as the tide having turned in Birim's and the first step toward a well financed E & D company will be when the agreement with Ashnati is finally signed and BGI receive's the initial payments.
Brian |
