Laura B.

Your number of 111.7 M shares (or 16.2% of OS of 691.6 M shares) for CLF holding in KWG is consistent with the number (approximately 111.8M) that CLF voted against the 1 for 50 share in the first meeting of May 2012. So, it could be safely concluded that CLF has not sold or bought any shares during May 2012 and June 2013, noting that CLF is deemed to be an insider (even though it pull its nominee from the KWG BoD) hence any buy/sell has to be reported.

Just for for information, the vote for the second attempt for the supershares (1/50) has been defeated one more time because CLF NO vote would amount to 111.7/380 (total voted) = 0.294 + 29.4% of the vote at the last AGM. ClF vote alone is almost 1/3 of the vote required to defeat the resolution. All that was required was 33.4% - 29.4% = 4% (x 380M = 15.2M shares). 15M shares would only require only 10 shareholders with an average of 1.5M shares each to join CLF to defeat this 1/50 resolution. It should be noted that some of KSU members have (or have control of) a lot more than 1.5M shares...This is water down the bridge, but the vote could have been won if the 4% were switched from NO to YES.

Back to CLF holding and the worth of it. Let's take 120 M shares as a round figure. To buy all this back from CLF, KWG would need to offer at least $0.04/share (0.4 x 120 = $4.8M). To sweeten the deal a bit, let's give CLF a premium of about 30% to make it $6.2M, or just round it off to approximately $6M. Final offer, take it or leave it!

While we are at this buying mood, let's talk about the other 70% of BD. KWG can offer another $20M for the rest of BD ($4M/16.2% x 70% = $20M) assuming that the rest of KWG (BlackHorse, RR, etc.) is worth nothing (= zero) and we don't want to pay the 30% premium. We might consider a 30% premium to bring this up to $26M, if the negotiation gets serious enough.

My take is that, KWG does not have the ready cash to pay CLF $6M for the 16.2% of KWG, but it might reach to the bottom of the cash box to come up with this amount just to get the thorn off its side. But $26M is another story...Unless, of course, KWG can come up with some clever scheme which would involve some new (with deep pocket) dance partner who would be a bit more accommodating (whatever that means).

The options may be just around the corner (e.g. Baosteel), but we may see some surprises.

For now, I would not count on CLF as a potential partner to develop anything in the RoF. It is fighting for its own survival. Probably, CLF just want to get some money out and run.

goldhunter (just my musings, feel free to plug in your own assumptions)