Terry:
I believe the deal with Placer was in place as soon as bgo reached a price level that made it very obvious that a takeover attempt of bgo would happen before bema could negotiate a deal for Star. Some people either knew or surmised this during the early summer months and the distribution of bgo became fairly obvious. After the announcement in September of the deal with Placer, a wholesale distribution of bgo turned into a panic to unload shares. A majority of those shares came from institutions that felt they had been had. First, there was the inconsistencies on news releases by bgo, second, problems with production were kept secret, third bgo threw star to the wolves. Terry, whether you can accept it or not, this is how a great many influential people feel and they are not likely to forget. Many of them feel that bgo would be in much better shape, had they kept the CC for a better deal until the price of gold improves. At current gold prices and with copper also on the ropes, this mine is not going to be built until commodity prices return to higher levels. When they do as they will, BGO could have gotten a much better deal. This is becoming more evident as marginal mines close, exploration has all but come to a standstill and the seniors are depleting reserves at unprecedented levels. Initially, when the market improves, the first to feel the affects are going to be holders of world class deposits, that can be up and running relatively quick. The development of the CC is going to take years, and bgo is going to lanquish until production is imminent. By that time, some of the market hostility to bgo will have dissipated. Unfortunately, this also means that substantially higher share prices are years down the road, not a good scenario for current shareholders who are under water.
Ken |
