Kinross Gold issued a press release this morning titled Kinross Succeeds in Bid for Aurelian. Unfortunately, their Tender Offer failed to bring them 90% of Aurelian’s issued and outstanding shares:

“A total of 108,524,181 common shares of Aurelian were validly deposited at the expiry time
of the offer. Kinross now owns a total of 123,524,181 common shares of Aurelian. At the time
of the close of the offer, this represented approximately 74.8% of Aurelian’s issued and
outstanding common shares on a fully-diluted basis.”

Now, when all Aurelian stock options are added in the total comes out to just over 80%.

Unfortunately, In order to de-list Aurelian shares and takeover the company, Kinross needs to hit 90%, so Kinross has now extended its offer to September 15th:

“Kinross has also extended its offer to enable those shareholders who have not yet tendered
their Aurelian shares to the offer, to deposit their Aurelian shares to the offer. The offer,
as extended, will now expire at 6 p.m. (Toronto time), on September 15, 2008.
A notice of extension will be mailed to Aurelian shareholders in the coming days. If Kinross is
successful in acquiring 90% of the shares of Aurelian under the offer (excluding those
shares acquired in the private placement), it intends to acquire all of the remaining
shares by compulsory acquisition.”

KINROSS CAN’T GET TO 90% WITHOUT A MAJOR HOLDOUT, OR A MIRACLE

To hit their 90% figure, Kinross needs to acquire 10 of the remaining 20% that did not tender their shares. Said another way, Kinross needs to convert 50% of shareholders that did not tender their shares. The only way I can see this happening is if a single major shareholder (i.e. Keith Barron) has not yet tendered his shares but, with one fell swoop, could hand over most if not all of the 10% Kinross needs.

Otherwise, if the non-tendered 20% group of shareholders is made up of the fragmented but united Aurelian AGORACOM Community, Kinross will need to go back to the drawing board because 50% of this group is not about to change their mind anytime soon. This is especially true when you consider the fact that the Community has put up close to 2 million shares for sale at $20 or higher.

WHAT NOW? WHAT HAS KINROSS WON?

As of this moment, Kinross has achieved nothing more than becoming a majority shareholder of Aurelian Resources. Aurelian continues to trade on the TSX and will continue to do so if Kinross fails to acquire 90% of the Company.

As such, the next battle line is September 15th, the deadline of the new extended offer. Kinross will be doing its best to make this look like a fait accompli … but it will take more than that to get convert non-tendered Aurelian shareholders into Kinross shareholders.

In the meantime, Kinross can not be happy about failing to hit the 90% mark. If Kinross fails, which is a very strong possibility, it will be left with 2 public companies and all the effort required to run them. No matter what Tye Burt (Kinross President and CEO) says in his press releases, he can not be happy with the possibility of this outcome.

CONCLUSION

If Kinross fails to acquire 90% of Aurelian shares, then Aurelian shareholders that did not give in to the tender will get what they always wanted - an opportunity for Aurelian to realize its full potential value over the next 2-3 years and the chance to sell their shares at $20.00 or higher.

Congratulations to the entire Aurelian AGORACOM Crew for its unbelievable efforts to date. As I said in our press release yesterday, This is by far the most successful Canadian online shareholder activism campaign I have ever seen.

Keep up the good fight and set your sails on September 15th.

Regards,
George

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