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Gold/Mining/Energy : SOUTHERNERA (t.SUF) -- Ignore unavailable to you. Want to Upgrade?

To: crudestope who wrote (5317)	1/7/2000 2:10:00 AM
From: buylowsellhigh	Respond to of 7235

Vaaldiam? I'd rather have some Valium! With Lysol and a Diet Coke - hold the ice!

To: crudestope who wrote (5317)	1/7/2000 7:32:00 PM
From: crudestope	Respond to of 7235

Dear Everybody, I have received a few private communications expressing regret that SUF has entered into a joint venture agreement on three of its South African diamond prospects. I too would have preferred for them to have remained wholly owned but obviously financial circumstances dictate otherwise. It should be noted that these three properties are near grass root prospects and certainly need a lot more exploration expenditure than allowed for in the joint venture agreement. Nevertheless, SUF can regain control and in the meantime the agreement gives it breathing space and continued exploration at no expense to itself. The alternatives to the jvs would have been abandoning the prospects or a financing. I would have preferred a financing (though not at the present share price) on the understanding that the existing SUF shareholders would have been given the first bite of the cherry, in other words a rights issue to the rightful owners of the Company, the shareholders. NOT by way of a private placement, to insiders and friends, or a brokered placement, to brokers and their preferred clients, which are the favoured means of raising money in Canada. The very things I detest in the Canadian market because they are done without shareholders approval and on terms which are not to their benefit. For your interest I 'enclose' the following extract from the December issue of a newsletter issued by Loeb Aron & Co., a London based mining finance house, re Canadian financing, brokers and regulatory authorities. I should add that most mining finance comes from European sources and the Canadian regulatory authorities and stock exchanges, which often appear to be operated for the benefit of the owners, e.g. stockbrokers, are therefore well advised to take note of European concerns as outlined in the Loeb Aron comments. Best wishes, Crudestope. Loeb Aron note: In recent times we have seen many examples, primarily on Canadian Exchanges, of the flagrant abuse of minority shareholders, outright fraud and puny and derisory punishments handed out by regulators for blatant transgressions of securities legislation. Perhaps the most frightening aspect of this are the enormous advantages that the sophisticated have over the ordinary investor, especially in the mining finance market that we find ourselves in. For example, the infamous "C$97,000 rule", the one which is designed to protect widows and orphans in fact is the one that ensures widows and orphans are consistently the victims in the mining market. At its simplest this rule imposes the obligation on junior miners and explorers to sell a block of at least C$97,000 worth of stock when carrying out a private placement. We should at this stage totally forget existing shareholders pre-emption rights in relation to private placements; the last time someone could spell pre-emption in Canada was around the time of Montcalm and Woolf. Such rights are unattractive to Canadian listed juniors because of the overheads associated with the stock exchange requirement that the rights themselves be listed. Thus do the exchanges themselves deprive existing shareholders of opportunity. Typically private placements are carried out through insiders and their cronies who are able to buy the "units" at an exchange approved discount to the prevailing market price with warrants tacked on to increase upside. Sometimes convertibles, nearly always convertible at the investor's option without a realistic hope of redemption by the company and yet carrying a generous coupon, or the now infamous "special warrant" are used. Such instruments reduce the accessibility and transparency of the market to ordinary investors at advantageous junctures in a company's development. Shareholders are rarely asked for permission to increase the capital of a company and, most importantly, independent shareholders are almost never asked. The British and US systems of regulation represent an altogether fairer and better system. End of Loeb Aron quote.

To: crudestope who wrote (5317)	1/7/2000 7:59:00 PM
From: crudestope	Respond to of 7235

Angola. Dear SI Readers (just to be different!), I was told that De Beers is persona non grata in Angola. Apparently it will be allowed to mine diamonds only from any new discoveries the company makes. The Government accuses the Company of having bought stones for many years from Unita, the rebel movement, thereby prolonging the civil war. The present De Beers clean hands policy of not buying stones from rebel movements is regarded as a hypocritical attempt to regain favour with the legitimate African governments. Have a pleasant week-end, Crudestope.