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Gold/Mining/Energy : DROOY Durban Deep- Best S. African Mine -- Ignore unavailable to you. Want to Upgrade?

To: Chispas who wrote (546)	10/22/2000 9:45:42 PM
From: russwinter	Read Replies (1) \| Respond to of 851

Two problems with the takeover scenario: 1. South Africa's govt appears to be discouraging mergers or takeovers from outsiders (witness FN-GOLD). 2. DROOY is a high cost producer, not exactly what the majors are after now days. Reserves with 125 cash costs, is worth 40 or 50 bucks an ounce to a buyer. Reserves with 250- 275 cash costs, has nominal value. DROOY would be a great stock to own in a big up move in POG. Great leverage from this point. But, as a takeover in a sub-300 environment, makes little sense.

To: Chispas who wrote (546)	10/23/2000 12:12:02 PM
From: baystock	Read Replies (1) \| Respond to of 851

This Oracle character must be smoking something powerful, if he thinks DROOY will be acquired for a 500% premium. What an idiot! <<Average Acquisition Cost of Production of the Four Acquiring Candidates applied to DROOY is $8.87. And weighted at 75% is equivalent to $6.65. Average Acquisition Cost of Reserves of the Four Acquiring Candidates applied to DROOY is $25.11. And weighted at 25% is equivalent to $6.28.>> THEREFORE, per my valuation method the practical acquisition value of DROOY is $12.93/share (6.65 + 6.28)… rounded to $13/share.