Re: Why buyout is painless
in response to
by
posted on
Aug 01, 2011 08:27PM
(Edit this Message from the "Fast Facts" Section)
I've mentioned this before but, back in 2006 I bought Aurelian Resources for 68 cents a share. Two days later drill results came out for their Fruta Del Norte deposit deep in the jungles of Ecuador. Mind you these results were nothing short of spectacular, but the fact remained that this property was in an unfavorable jurisdiction and a billion or so infrastructure dollars from ever becoming a mine. Two major negatives staring investors squarely in the face. Nevertheless, I watched the share price leap to $44 within the next 9 months. 68 cents to $44 in 9 months. Yikes!!!! Kinross, our neighbor to the west, took Aurelian out making lots of shareholders wealthy in the process, but they still sit on the property in Equador, unable to mine the resource because the political risks are too great under the current regime.
It is easy to find historical data of mining companies going from pennies to hundreds of dollars in a matter of a couple of years back in the 70's.
Goldcorp recently paid $1000 an ounce gold in the ground for Andean Resources in Argentina. Obviously they believe there to be far more gold in the ground than the 43-101 defines at this point, but that's a big number regardless.
My point is, there are lots of favorable points a suitor could attribute to SFMI. The bullet points could fill many pages. When gold fever strikes, things heat up quickly. Greed and fear mix a strong cocktail, but if you are sitting on a pile of SFMI shares you'll be in the catbird seat when the greatest show on earth begins to unfold. I'll be sticking around. The first drill that justifies the historical numbers available will send this stock skyward. How high is anybody's guess. Suitors looking to replace deminishing resources will have to act fast once the drills begin talking. $1? $2? Probably too low for my way of thinking. But what do I know?
Best to All Longs,
ag