barrick / novagold .. vla la porte de sortie >

barrick / offre hostile sur novagold ( code NG) .. voila la porte de sortie typique pour se sortir de son désastreux hedge book ...

apres avoir contribué avec ses alliés a ruiner le prix du spot et donc les mines y compris novagold .. main basse , raffle tout à la casse ...

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from midas

The major gold news of the day:

08:24 NG F ABX (Barrick Gold) to make offer of $14.50/share for NG (NOVA GOLD) (11.67)
ABX is making the bid in order to consolidate its interest in the Donlin Creek project in Alaska and to purchase 100% of the Glaore Creek project in British Columbia. ABX purchased the right to earn up to a70% interest in Donlin Creek as part of its January purchase of Placer Dome. Donlin Creek had 14.8 million ounces of measured and indicated gold resources, and 13.6 million ounces of inferred gold resources. Galore Creek has measured and indicated resources of 6.0 million ouncesof gold, 75.4 million ounces of silver, 6.8 billion pounds of copper, as well as inferred resources of 7.2 million ounces of gold, 73.4million ounces of silver, and 5.0 billion pounds of copper. Separately, ABX and Pioneer Metals (PSM.CN) announced an agreement under which Pioneer agreed to recommend its shareholders tender their shares to ABX's cash offer to purchase all of Pioneer at C$1.00/share. PSM. CN's directors, officers and certain shareholders, representing over 40% of Pioneer, have agreed to tender. The value of the Pioneer deal is C$64.7M in cash. ABX will be announcing its second quarter results on 2-Aug and is on track with its 2006 production and cash cost guidance. Company will be updating on its overall project pipeline later this year. ABX's financial advisor is CIBC. Conference call at 11 ET. Dial-in: 888.858.6132 or 706.670.4490.

-END-

This is a big deal. Barrick’s hedge book is a disaster. Now we can see what their exit plan is. Adrian sees it clearly:

Bill,
Have you seen that barrack is trying to cover their short position by bidding for Novagold? I am an NG holder. I am sending a letter of protest to NG that they must not accept this ridiculously low offer after these guys have depressed the gold price and as a result the share price of the mining companies. To let them acquire NG is to allow crime to pay!
Cheers
Adrian

Gentlemen,
I am a large shareholder of Novagold and I am outraged by the unsolicited offer of Barrick. I wish to register my utmost opposition to this acquisition. Barrick have, through their "creative" hedging strategy, depressed the gold price. They were sued by Blanchards for having suppressed the gold price through hedging. Blanchards were forced to settle in this case because of the unfortunate damage to their financial position due to hurricane Katrina but they nonetheless managed to extract a promise from Barrick that they would not hedge their production for the next 10 years. Barrick is a company that has bragged about how much money they have made by selling forward. This is a company that is anti-gold. They are on the short side. They have suppressed the price of gold and as a result they have depressed the price of mining shares including those of Novagold. It is absolutely inadmissible that they should now benefit by buying Novagold at a suppressed level that is partly their doing. This would be to allow the ultimate in market manipulation.

I strongly urge you to reject ANY and ALL offers from Barrick Gold.
Regards
Adrian Douglas

Bill,
This is from Novagold’s website

QUOTE

NovaGold's net share of Measured and Indicated Resources after all earn-ins is 12.1 million ounces of gold, 75.4 million ounces of silver and 6.8 billion pounds of copper with additional Inferred Resources of 13.9 million ounces of gold, 106.1 million ounces of silver, 6.6 billion pounds of copper and 2.2 billion pounds of zinc. This is one of the largest resource bases of any exploration or development stage precious metals company. We strongly believe that exploration success is one of the best ways to create new shareholder value and since 1998 have added an average of over 2 million ounces in new gold resources to our inventory each year.

END

Barrick’s offer is 1.29 B$!! This would get them all of the gold at about $50/oz in the ground and then the 181.4 million ozs of silver and 13.4 billion pounds of copper and 2.2 billion pounds of zinc would be for free!! This is barely a reasonable offer for the gold in the ground even if they had no other mineral resources!.

This is daylight robbery and would allow Barrick to cover their short position for a few hundred dollars per oz (including the cost of production). The gold resources of Novagold of 26 million ozs is greater than Barrick’s short position so they would cover with a single acquisition! Investors must protest and resist this acquisition.
Cheers
Adrian

Adrian is not alone:


Hello Bill:
Just wanted to say how much I enjoyed having lunch with you at Chili’s and also meeting your friend Natasha.

I wanted to say something about Barrick’s announcement of its bid to buy Novagold (NG). Novagold, debt free with $200 million in the bank, is a truly great unhedged company with three outstanding properties, one of which will begin production in ’07. During a recent conference call with analysts http://www.vcall.com/IC/CEPage.asp?ID=102002, Rick Van Nieuwenhuyse, NG’s CEO, was asked to confirm the analyst’s math. The analyst reckoned that NG’s valuation could go ten times higher just based on the typical valuation progression of a gold company as it moves step-bystep from explorer to producer. Rick V. responded that the analyst’s numbers were correct. Now get this, at the time (March ’06) the analyst was using a gold price of $550, a silver price of $6 and a copper price of $1 (yes, NG has a bunch of silver and copper, too). Now plug in today’s prices for those metals, and better yet, future prices like $850 gold and $25 silver (or surely higher for both) and will someone please direct NG’s owners to the nearest yacht dealer.

So, Barrick, the Darth Vader of the gold world, bids a mere 24% premium over NG’s current price. It may have just been a lowball starting bid but it is absurd. I called NG’s headquarters today and was told that management was in meetings. Surely, they had to go behind closed doors just to find a place where they could laugh uncontrollably and thus prevent embarrassing themselves in front of other employees.

Nevertheless, here is another instance where a major is desperately seeking reserves. Virginia Gold was more than a ten bagger, as I recall, as a result of its purchase by Goldcorp. Darth Vader might be trying to "use the force" on NG but it would do far better by using more money, a lot more money.
John Black Germantown, TN

Tain...on y vient...

Le mouvement de concentration concernait aussi les hedgées (barrique qui bouffe, PDG) mais manifestement, un gus hédgé à mort qui a été capable de racheter le hedge book de pdg en plus, ne peut rester insensible* envers de belles réserves unhedged...


*("un sans cible" non plus )

je vous rappelle l'existence des 'non recourse loans' qui lient certaines mines magnifiques à cabalas qui jouant le business angle de start up avait gentiment financé des juniors explo....non sans pécho une hypothèque sur les réserves des emprunteuses... des mines comme Nova, AEM, ECU, SRLM et autres sont des pépites pour qui cherche du mixte en high grade...finalement, une AK ça n'a pas que du mauvais... (il me semble bien qu'on avait parlé de non recourse loans pour AEM il y a 4/5 ans...de mémoire et donc "sous toutes réserves*"

"sous toutes réserves*" *(si j'ose dire en l'occurrence, tant cette offre est elle aussi "sous toutes réserves") ...

dépêchons nous d'en rire...avant d'avoir à carrément se pisser dessus

La proposition de Bourrique est grotesque, sans doute un simple ballon d'essai, histoire de partir de quelque chose, ( sauf si Nova a des recourse loans étrangleurs, mais je ne me souviens pas si elle était sur la liste en 2001, quand cette histoire est sortie... n81

je me posais aussi la Q des recourse loans eventuels de NG .. .. pas d'infos moi non plus pour NG..

en tout etat de cause , on remarquera que barrick fait ses offres hostiles , apres une forte caballasserie du gold .. pas un hasard ça non plus ...

pour placer , gold etait à 475 $.. on sait où il est allé depuis ..