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Gold/Mining/Energy : Abacus Minerals Corporation (V.AMC) -- Ignore unavailable to you. Want to Upgrade?

To: zoggy who wrote (263)	11/27/1998 10:52:00 PM
From: Neil Irwin	Respond to of 397

Zoggy, Redstar and Snowfield are not necessarily subsidiaries of Abacus, but they must share common owners. Through these deals, though, both will issue shares to Abacus. These type of deals are fairly common to finance projects. Look at Abacus' situation: 1. Abacus has three other projects of higher priority: La Manchuria in Argentina, and two others in Portugal and Alaska. 2. The deals with Barrick for these properties probably stipulated that Abacus must spend a specified amount of money this year, or possibly lose the properties back to Barrick. 3. Abacus also has little money to spend on grass roots exploration 4. Abacus had problems raising money this year. If they needed to raise more money for these other projects, they would have had to dilute our ownership of La Manchuria (and the other higher priority projects). Thus they spin off the project to a related company. The related company can then raise money by itself, and in fact Redstar announced a private placement today. Management retains control of the project, as they have control of the related company. And the main projects are not diluted. Remember that less than 1 prospect in 100 is an economical deposit. The prospects of La Manchuria look pretty good, but a lot more work remains to be done before we can even start talking about it being economical. So, would you rather dilute your ownership of a more advanced project to have a couple of other shots in the dark? Hope that this helps. Neil.