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Gold/Mining/Energy : Century Mining Corporation
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From: FreedomForAll3/23/2011 3:34:28 PM
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So CMM is going to combine with another small miner. How do Century shareholders fare in this combo?
The buyer White Tiger Gold has less than 1/10 the reserves and resources of Century. The buyer would be producing about 1/5 as much gold as Century. So why do Century shareholders only get 61% of the combined company when Century has 90% of the reserves and resources and 80% of the production?

The major shareholder of White Tiger has 75% of its shares and also holds 34% of Century shares. He will hold just over 50% of the combination and will be able to do what he wants with the company regardless of whether it's good for lesser shareholders.

Century shareholders should have expected a share price of 2.50 to 3.50 per share within 24 months assuming Century delivered something close to promised production and gold prices stay near the current levels. Under the new regime the best shareholders will get is about two thirds as much also assuming that the company delivers something near projected production. For $4 million current loan funding from White Tiger (which is about 1 cent per share) current Century shareholders are giving up 80 cents to a dollar per share.
Century must be in a tough cash position and the board of directors have decided to sacrifice the existing shareholders long term to raise a little money in the short term.
This deal reeks of an inside job to benefit the new majority owner of the combined company. Almost makes one long for CEO Peggy.

Any thoughts on how management is being paid off to agree to this rape of shareholders?
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