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Strategies & Market Trends : Ride the Tiger with CD

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To: Claude Cormier who wrote (125600)	7/27/2008 2:48:46 PM
From: E. Charters	Read Replies (1) of 313663

15 years is a million ounces per year. $900,000,000/yr Costs are $228 million/year for 4 million ton/yr operation. Net $672,000,000 After taxes net $201,600,000,000 based on Correa's 70% grab. Shares out 155 million based on issuance of 30 million shares at 15 bucks to get into production. Value at 12 times earnings is $15.60 per share. Kinross's offer to them is a gold-in-the-ground offer worth about 18 dollars a share if K is valued at 40 bucks. You don't buy things except to make money on them. If K wants to add something to their bottom line they have to get more out of it down the road than they paid for it. They are paying for it in share dilution. If they pay share for share @ 24 bucks for a share of K, they lose value in those shares( probably 40%) and gain nothing. K has 615 million shares out. They are paying 43 million shares or 7 per cent of their capitalization. This will earn K perhaps 30 cents per share add $3.60 per share in increased value after funding the project with 25 million shares @ $20.00. Fair deal for ARU people. EC<:-}

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