Author: teevee -- Date:2000-07-31 17:56:59
Subject: estimates and sizing up De Beers
On a "back of an envelope" basis, applying known values to the additional tonnage I see from today's NR, I figure WSP's minimum 66% interest is worth about $10 billion, un discounted and in ground. Discounting to 10 cents on the dollar, with 60 million shares outstanding, a reasonable offer should be about $16.50/share, and not anywhere near De Beer's paltry offer of $4.25. DeBeer's should add the initial $4.25 they offered to $16.50 or so for good will, and to acknowledge the importance of the deposit to their long range plans. IMO, DeBeer's overt niggardliness will do irreparable damage to their image and diamond marketing efforts in the long run. Already, I am of a mind to ensure that the next diamond I buy is certified not to be a DeBeer's diamond. It is a shame that such an old company has lost the vision and foresight its founder, Cecil Rhodes, displayed. Now there was a man with a world's view. Instead, DeBeers seems to be clinging to colonialist methods better suited to the apartheid era.
regards, teevee |
