On the other hand, Wax, holding CHM interest makes Fancamp very vulnerable for a low takeover ($1.00). If Fancamp could shareswap with Champion for a larger percentage of it's entire company, say 23%, and get it into direct ownership with shareholders, then we've:

1) increased our position in Fermont,

2) divested ourselves of a hostile from that area (they'll have to buyout Champion, not us),

3) given ourselves the chance to ride Champion directly, not secondly, for when CHM reaaches 3 billion tons iron or lots more later this year,

4) divested outselves of having to dillute FNC in 2012 to keep up with our expenses of CHM's 8 drills.

With Magpie in an IPO, and Champion out of FNC hands, we'll be left with Lac Lamalee and grass-root properties. Once there is iron at Lac Lamalee we become again very vulnerable. I'd like Lac Lamalee in an IPO process as well. Peter said he won't let go of Lac Lamalee cheaply, and CHM is doubtful going to give away much more of their company beyond 25%. So it's likeley that Lac Lamalee will remain part of FNC until IPO.

Once Lac Lamalee proves 300 tons to a half billion tons of iron, one can imagine the multiples due to it's proximity once Champion entertains an offer. Remember, consolidation has already begun with Cliffs taking out Conolidated Thompson and Wisco part of the area, so a CHM offer is very likely. I'd like Lac Lamalee to be an IPO when it happens.

With an independent director Depatie on CHM's board, he's there to help take CHM into a sale, just as he did with Consolidated Thompson to Cliffs. On one hand, we've all assumed that Lac Lamalee will be bundled into Champion in some way during a takeover. But is is possible that it could be ignored during a Champion takeover. Lac Lamalee may have a half billion, but Champion will command much more focus. Perhaps a year following a successful bid for Champion might Lac Lamalee be considered. It may be that in order for Lac Lamalee not to be ignored during a full press assault on Champion, we'd have to have an estimated 700 tons to 1 billion tons of iron. This is all the more reason why a Lac Lamalee IPO will allow shareholders more opitons to make decisions -If an individual doesn't have time to wait a few years for an offer, then one can benefit in the short term by a SP increase from poximity to a CHM offer.

On the other hand, Depatie could help pave the way for a friendly CHM takeover in 2012, which may include consolidating FNC interest and Lac Lamalee in 2011. In this case there are multiple scenarios he could negotiate with a Major who has cash. If he and Larson are already talking to Cliffs, there could be an increased offer by Cliffs, that would make up the difference to losing a larger percentage of CHM company so that CHM could negotiate an offer for both FNC interest and Lac Lamalee. Or Cliffs could porvide to CHM that extra cash incentive for Smith and Granger to release both FNC interest and Lac Lamalee.

This cash incentive would be no more then 100million. A company like Cliffs can see Fancamp as a $1/share or 100million easy hostile offer for owning 17.5% of CHM (which some estimate will be closer to 5 billion in 1st quarter of 2012) plus NSR, and owning Lac Lamalee's half billion tons of iron, in addition to their newly aquired Cons.Thompson land, shipping, and contacts. Yes, we are very, very vulnerable right now. I've already experienced a dissapointing buyouy for $1 with FWR, and I don't want to experience it again.

Where is Arcelor in all this? They've seemed annoyingly disinterested and quiet.

-sg