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GDO - Gold One International

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Anybody notice this interesting little tidbit in today's speeding ticket :D

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Starting to research this gold stock, appears to be very cheap despite the good run its had lately. Im envious of those of you which got in a few months ago and are already sitting on 50%+ gains...
Will report back when I formulate some more interesting thoughts to talk about!
 
GDO up 14% today. They are putting out some good results and are now grossly underpriced IMO.
 
Trading Halt.
Material acquisition.

With the size of the company I would have thought a more likely reason would be that they were the acquisition!

Will be interesting to see how management handles the acquisition to see what they are really made of!
 
VSntchr said:
Trading Halt.
Material acquisition.

With the size of the company I would have thought a more likely reason would be that they were the acquisition!

Will be interesting to see how management handles the acquisition to see what they are really made of!
Click to expand...

Looks like they are buying some gold/uranium miner for $250mil. I am guessing they will fund the acquisition through debt (the announcement doesn't say I don't think). Any thoughts?
 
TabJockey said:
250m is not pocket change for GDO. A very interesting aquisition, looks like a high cash cost asset also.
Click to expand...

Yeah, I really couldn't piece together this acquisition. Its for $250m right...which is bigger than the entire value of Gold One, is it not?
Debt to Equity will now be through the roof. I also disliked the way they went about saying "we have the right to issue more shares should funding fall short".

We should not be told what management has the right to do! They really could have worded that a lot better.

Whatever happened to shareholders being the kings and management being the sword wielding knights?

Anyway, ive been trying to get out all week....I had a nice little profit at one stage...and each day my sell order was just missed...and each day I would lower it...and still miss...finally today I realised that sometimes I need to know when to cut my losses and just take the market price. I can't let this one keep going, finally happy to say that I'm out.

Will still watch with interest to see how the acquisition pans out, but definitely doesn't make investment grade for me any more - which is a shame because I thought this was a initially a great undervalued company with good exposure to gold.
 
I was interested in this one but I decided on Ramelius in the end and now that they have made this acquisition I am glad I didnt buy them.
 
:eek:Not to happy about the take over either.
been a holder for about 6months so made a good profit so far.
At least the SP has steadied now and even recovered a bit.
Interesting to see how they fare in the future.
 
mikem said:
:eek:Not to happy about the take over either.
been a holder for about 6months so made a good profit so far.
At least the SP has steadied now and even recovered a bit.
Interesting to see how they fare in the future.
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discussion in the fin review - street talk about GDO and its acquisition. What don't you guys like about it? I haven't looked into it, but if they have bought a producing asset -

163k Oz/year production with 13MOz resources for $232M that seems like a pretty decent deal - wait for margins of course, but further investigation is warranted - an operation of that production size on it's own here would be worth similar to Integra's or SLR's market cap, I think they paid a good amount for instant production.
will look further, but lets dig this ground over and see what is there - may be an excellent opportunity.
 
My problem is the size of the acquisition, combined with the fact that it is funded by debt. debt to equity is through the roof now, any substantial contraction in commodity prices could be enough to ensure they cant meet interest payments.
 
VSntchr said:
My problem is the size of the acquisition, combined with the fact that it is funded by debt. debt to equity is through the roof now, any substantial contraction in commodity prices could be enough to ensure they cant meet interest payments.
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Valid point, if they are producing 139kOz/year then they will be generating somewhere near $76M at $550 margin/oz. That will mean 4 years at this price to pay back the project. If the price comes off that will crimp their investment, so in that regard it is risky. depends on POG outlook and exploration success - if they can prove up more resource then their MC/debt will decrease (does it work like that?) and make things more manageable assuming they have the cash there to do it.
Looks like they want to leverage hard into their own bullish forecast of gold.
 
noco said:
GDO has gone into trading halt today. Anyone know why?
Click to expand...
Announcement says: due to change of control.

could this be the Chinese buyer taking over GDO? Perhaps that would explain the latest acquisition. I get a feeling that there is alot that management isn't declaring to shareholders...and it seems ASIC agrees with me judging by the announcement earlier in the week....
 
16 May 2011
Cash Offer to Gold One Shareholders of A$0.55 per share
Transformational Transaction for Gold One and Introduction of a Strategic Partner with a Minimum Capital Injection of A$150 Million
  • Offer of A$0.55 (ZAR4.08*) for Gold One shareholders wishing to exit
  • Represents a premium of 27.9% above the latest closing share price and 25.1% above the 30-day VWAP
  • Consortium of Chinese investors to become long term strategic partner and value investor
  • Consortium has already secured 17.7% of Gold One from African Global Capital (SA) (Pty) Limited
  • Consortium intends to secure a stake of 60% to 75% in Gold One
  • Capital injection of at least A$150 million (ZAR1.1 billion*)
  • Consortium participation enhances access to Asian capital markets
  • Gold One to be an active participant in the consolidation of the global gold industry
  • Transaction is recommended by the Gold One Board of Directors
Click to expand...

So... A$0.55 per share for those looking to exit?

I hold at present but need to look into this offer in more depth.

What's everyone's thoughts?
 
Really pissed they cudnt have done this before they announced that acquisition last week, that way I would have still been holding and would have locked in a nice 30% profit.
 
From what I understand the offer opens on the 22 June and closes on 21 September (unless extended), so I *think* that means the target share period is within those dates? I could be completely wrong.
 
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