Q#1) Being that Fancamp still owns 50% of Black Horse (“the Koper Lake Project”), I wonder, does any of the accumulation of KWG stock—being discussed here—or any of the accumulation of rights or interests in KWG—also being discussed here—have any bearing on Fancamp?

Q#2) Does buying into Fancamp make any sense to KWG Shareholders, so far as arbitraging the difference in market capitalizations?

This is my understanding of the KWG Option for Black Horse from Fancamp:

To earn 50% of the Project, during the course of the three years following the signing of the agreement (7 May 2012), KWG is required to pay Fancamp $1,500,000 in “option payments” and must spend $8,000,000 “on exploration.” As of April 2014, KWG has already spent $3,185,000 “on exploration” and its partner, Bold, has already “made a NI 43-101 compliant grade and tonnage estimate.”

Another $700,000 “option payment” together with a positive “Feasibility Study” will bring the KWG/Bold share of the Project up to 60%. “Paying Fancamp” yet another $15,000,000 “in equal installments” over three years will further increase the KWG/Bold ownership to 80%. To get to 100%, the KWG/Bold partnership is required to give Fancamp a 2% NSR (which will increase to 4% after the capital costs are recovered).

In other words, 50% of Black Horse (aka “the Koper Lake Project”) will cost KWG $9,500,000, by 7 May 2015 (more than Fancamp’s entire present market capitalization of $8,440,000). Fancamp will still own 50% (the same as the KWG/Bold combo) at that point. To get to 80%, KWG will need to pay, for exploration and for options to Fancamp, an additional $15,700,000. At the 80% level, KWG will have spent $25,200,000 ($1,500,000 + $8,000,000 + $700,000 + $15,000,000).

$42,770,000 = KWG Market Cap (including 50% Black Horse for $9,500,000)
$8,440,000 = Fancamp Market Cap (including 50% Black Horse, already paid)

Also keep in mind, there’s more to Fancamp than its present 50% ownership of Black Horse (Koper Lake). As a whole (even individually), its properties (with world-class NI 43-100 documentation, such as Magpie)—as well as its stock and NSRs in other publically-traded companies (such as Champion, Argex, and Lamêlée), without question, are worth many multiples more than its interest in Black Horse (Koper Lake).

http://miningmarketwatch.net/fnc.htm

Full disclosure: I have a large position in Fancamp and no position in KWG (of course, other than Fancamp’s present 50% ownership of Black Horse). So far as I’m concerned, Fancamp’s undervaluation is due to mismanagement. So far as I’m concerned, KWG, probably also, is undervalued but less so (in terms of its mineral assets) because it’s not subject to the same degree of mismanagement as Fancamp is.

So far as I’m concerned, I’m a visitor to this Message Hub and will only continue to post here if my conversation is not taken as an intrusion. After I post my messages to the Fancamp Message Hub, they’re generally received with total agreement by every single person who expresses an opinion. That, absolutely, is not what I’m seeking here (or there). Absolutely, please correct me where I’m mistaken or where there’s something I missed or don’t understand or where I overstated my case or where I haven’t been respectful.

Also, the two questions at the top of this message are not rhetorical questions. Please answer them. I’m very curious what differing viewpoints KWG Shareholders hold. As they say, “Listen and learn.”