Lethalgal,

Some of us just stay quiet in the background.

I would say that the introduction of Windermere into the share structure of V.DAN has been a game-changing event for the company. Prior to this, Windermere had some solid returns on a number of other plays, so when their name was associated with V.DAN a lot of other people decided to take a closer, serious look. Some of us have been in the stock for a lot longer; have believed in the story, but sometimes the market just doesn't get it. How else can you explain the psychology of, "it's only got a market cap of CAD4mm - there must be something iffy with it!" when now, with a market cap in excess of CAD50mm, everybody wants to know!? You know this, because of your participation in other undervalued gems like Freewest in the past and Fancamp now.

What has changed?

Windermere have good connections. The introduction of Mr Jim Cowley looks like a savvy move, as he is close to Rio Tinto among others, and has a lot of metallurgical experience, especially with Titanium (this story may ultimately be as much about titanium as phosphate, but for now, let's just deal with the phosphate). The introduction of Mr Marc Gagnon is another savvy move as he is a very switched-on, business person,and will bring some experience in the gold sector which may help V.DAN to expand its operations in that area. But more than anything, it is the credibility that they have lent to the story that has forced the wider market to look at the underlying figures and try to make sense of just how undervalued V.DAN is.

Figures

One just has to look at the Canada Phosphate presentation online to see potentially how undervalued V.DAN is for its phosphate. I think there is a general sense that when the updated resource is re-calculated, it should be in the order of 500MT, and that's just for the Paul Zone. If we even consider CAD1 per tonne of rock in the ground, you're looking at CAD10 per share (a) and that is multiple times less than the price paid in the CVRD/Bayovar transaction by Mitsui et al for rock in the ground; (b) and this does not even consider the other zones which could be just as big as the Paul Zone. I think Bernard is confident there could be over 1BN T in total in Lac-a-Paul. So when people bandy about CAD2 per share as the correct value of the company, CAD3 per share value, CAD7 per share value or more, who really knows! As with Freewest, it eventually got taken over at a level which still undervalued it considerably, even if shareholders made a nice tidy sum in the meantime. History can repeat itself whether we like it or not.

Price Action

It looks as if somebody with reasonably deep pockets is accumulating. The volume in the past 2-3 trading sessions is around 7-8% of total shares outstanding (a higher percentage of those not tied up in escrow when you consider that Windermere's shares cannot be traded yet, and probably wouldn't anyway!). My guess from previous experiences - and I don't know for sure - is that it is a fund positioning itself for the eventual negotiation which may come if V.DAN becomes a takeover target.

Next Steps?

It's hard to know. I honestly don't believe - and again could be wrong - that a takeover is imminent, but I think we can look forward to positive news emerging from a recalulated resource, news of metallurgical work being done on the concentrate, news from additional drilling and then, by mid year the results of the PFS. Whether this in itself would bring on corporate activity or the company would then seek to go all the way to the BFS stage is a matter of conjecture. But if we assume that "the accumulator" will go up to at least 9.9%, and Windermere the board and other friendlies bring this close to, or over 50%, then the free float begins to vanish quite quickly.

All I say is that I still believe the current share price grossly undervalues V.DAN.

CJ