amazingly, silvercorp is down 13% today. i can only imagine that shareholders don't like the prospect of dilution, but they have it all wrong. the offer of a half-share was initially valued at $70, but it's a lot less now thanks to today's sell-off in svm. klondex has a deposit of 3 million ounces of gold (at a 2g cutoff) in a prospective area that is also a mining-friendly political jurisdiction. if you're going to build a mine in the united states, nevada is the place to do it.

i think this would be a great deal for silvercorp if they can get it done. klondex is in some distress, like most exploration companies, and if i were in their place i wouldn't be too happy to see the vultures circling overhead. having been on the wrong end of one of these buyouts, i know how that feels, so this isn't a done deal yet. it is, after all, an unsolicited bid.

i think this deal is a steal for silvercorp, but we shall see.

http://www.reuters.com/article/marke...