ARP - V Argentina Gold Message Board

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Gold/Mining/Energy : ARP - V Argentina Gold

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To: waldo who wrote (524)	10/22/1998 10:24:00 PM
From: C Bunka	Read Replies (2) of 3282

If I may, here is an excerpt from a much larger email alert I sent to my subscribers at around 10:00 AM today. Where we might go is all speculation right now. And THAT is the point! People are SPECULATING again! That means that fair value might be exceeded on the upside, just as it was on the downside. Drill results due to be released tomorrow, and then again on Tuesday or Wednesday. (Sorry for the long post...) "So how do we value a potential takeover bid? We don't - it is too early. We might, however, speculate that US$25 per ounce might be spent to acquire Veladero since this is the price that Kinross recently paid (La Teko). If 5 million ounces eventually are proven to exist then this suggests a market cap for ARP of US$125 is reasonable. With roughly 35 million shares and a conversion to CDN funds, this is equal to $5.53 per share. If we discount fully for Barrick's potential 40% interest we are still left with $3.32 per share. If we ignore Barrick's interest and instead speculate on 7 million ounces and a take-out price of US$30 per ounce, we arrive at a price of CDN$9.30 per share. Remember that nearly 3 million ounces of gold (equivalent)have already been discovered at the Veladero property in the past couple of seasons. There is no question that gold exists in abundance here - the question has always been whether or not enough will be found, or whether the grades will be high enough, to make the deposits economic. Today's speculation is centered around the potential quantity and grade of gold discovered in this new target. So our speculations above regarding either 5 million or 7 million ounces of gold are really speculations that this new zone will uncover between 2 million and 4 million ounces. I personally do not have a lot of stock but what I do have I am keeping. I have not sold any stock during the last couple months." Just an opinion

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