Solitario Resources, (SLR) T. Message Board

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Gold/Mining/Energy : Solitario Resources, (SLR) T.

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To: grusum who started this subject	9/21/2000 8:09:53 AM
From: russwinter	Read Replies (1) of 38

I like this situation and am playing the Altoro arbitrage into SLR. I was a buyer of ATG last week at the 34-35 cent level. Here's my thinking about ATG/SLR: -- It is grounded in the reality of today's market. PGM deposits are developed not discovered and ATG alone would have diluted itself out of existence. The SLR combination brings US 7 million cash to the table to attack 100% owned Rincon del Tigre. -- The new entity is a different creature from ATG or SLR alone, but in my mind a better one. I see a Pangea-like company now, with an extremely underappreciated portfolio of prime (mineral diversified) properties with majors and heavyweights aggressively exploring and spending their money ($7 million in 2000 and AT LEAST another $25 million in the next few years) not SLR's. Lighting could strike at any of the following: Pedra Blanca (PGM): $7 million from Hunter-Dickinson Bongera (zinc): was $13 million but Pasminco has taken over and has EXPANDED drilling another 40% and soon. Yanacocha (gold-silver): All indications are that NM will attack this aggressively and SLR has a nice royalty. Sapalache (gold): ANGLY earns 51% by spending $6 million within four years. ATG's Brazil gold properties: $2 million a year by others. Rincon del Tigre (PGM): 100% retained solitarioresources.com ATG-SLR arbitrage at today's price: Purchase of ATG at 36 cents. 3 shares converts to 1 share SLR, effectively $1.08. SLR currently trading at $1.40 level. Arbitrage markup 30%, deal expected to close (likely)in fourth quarter. ATG-SLR valuation at today's price: Effective SLR purchase price 1.08. 23.1 million shares out after merger= Mkt cap 25 million CDN, or 16.8 US. SLR has US 7 1/4 in the till, so enterprise value is an absurdly low US 9.6 million. For this kind of exploration exposure, this one looks hard to beat! A wild card: Post merger SLR will be 41% held by Crown Resources of Crown Jewel fame (great project stymied by environmentalists). CRRS has a $15 million Cv. bond coming due in Aug, 2001 and lacks money to pay off (held by large holders). An obvious source of funds for that are the SLR shares. Clearly this major shareholder has a compelling interest in polishing up the SLR stock price. Therefore, SLR is a prime target to be put into play as time winds down for Crown. I can't image a much nicer Latin American property portfolio for a major or mid-tier company, especially if any exploration progress is made in the next six to nine months.

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