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Gold/Mining/Energy : Precious and Base Metal Investing -- Ignore unavailable to you. Want to Upgrade?

To: E. Charters who wrote (26090)	12/30/2003 2:26:04 PM
From: Louis V. Lambrecht	Respond to of 39344

Some issues I can't understand in M&A. Say: acquirer has a 7 years mine life, acquiree has 5 years mine life. Compound, the merged operation is down to 6 years minelife. Say: acquirer buys a grass roots. Exploration expected to run within 7 years. What was the long term gold cycle again? 11 years peak to peak? Three years are already gomne from the bottom. By the time the grass root produces, we're near the next cycle bottom. Me thinx, I better go political. Most leverage in phoney USD gold prices would only be obtained by phoney USD cost of mining: stay purely USA (don't trust the loney, it can go to parity). <ng> South Africa riddle: SA miners wanna get outdathere, going international, looking for a majority of operation outside SA and buying a new nationality. (Green cards for SA miners? <vbg>). Those who can't will be gobbled by the black empowerment. Yet another reason to get out of SA miners. What are they gonna buy: Russian, Central American, African, Australian.... North American? No deal: IMHO, best is to concentrate NA resources in NA interests. Falling USD = falling production costs. My problem: one side of the balance is concentration of the NA miners. Rest of the world would be acquisition by SA companies. Would NA miners buy rest of the world companies, they would lose in foreign exchange related costs of production: leaves rest of the world activities as poorly accreditive to NA companies, leaves rest of the world acquisition premium controlled by SA companies. I would play the acquisitions in NA only, with juniors able to attain optimum production in about 3 to 4 years (gold cycle). This excludes grassroots. My 2cents.