Hi Fastbuck1, I understand that you, as we all do, have some concern whenever a substantial shareholder sells out. As I did explain in my previous post, the exit clearly was very clean with no downward selling pressure and it went to either 1 or 2 parties.
Who knows what Stanley's own personal situation is currently and what his cash requirements are. We do know that he bought at the bottom of the market and has made a stack of cash in the past couple of years. I also agree that at the time of the calamitous share price drop in late 2008 we all saw him as our saviour particularly as it appeared RED had lost its way, but actually he didn't do anything other than buy shares whereas at the time we thought he might use his shareholding to change the management at that time when we were not so happy with things. But those times are now well and truly behind the company, RED has completely changed in its status as we all now know and RED now enjoys a considerable increase in institutional support.
I have recently queried the company about the status of the finance, which I see is the only thing holding back any doubt as to whether the project will be developed within the next year, and I have had it confirmed, as have others, that all is on track with the bank offer.
I understand the final documentation on the debt finance offer is already very close to completion, and its likely the bank will be completing all things BEFORE the end of the July, but with some of the board traveling to N America soon and then Diggers and Dealers in early August the final acceptance of the finance might still be as I had understood it previously, to be the end of the first week of August. BUT there may well be a Trading Halt at the time of the bank offer so that such sensitive information is not leaked out, the only reason why that might not be called is if it will take more than 48 hours for RED to have the final bank offer vetted by a consultant.
I think its also important to consider that Stanley, whilst our past saviour, and a smart man with his previous investments such as Equigold etc, is not necessarily in a position to know any issues that could affect the future course of RED - he was instrumental in having Bolitho included on the board very recently but I suggest no board member would be crazy enough to ever jeopardise their position in providing sensitive information to any shareholder, particularly of the size of holdings that Stanley had!
Finally I understand that the development of Siana has NOT been delayed whatsoever with the way the development has proceeded, even though the bank finance has been put back the past couple of months.
RED board made the call that it would continue to fund the project, in a careful manner, from cash reserves prior to receiving the bank offer, and in any case, had no intention to draw down the bank portion of the funds until later to conserve costs of the borrowings (not that it amounts to much additional cost in the overall context of the funding). Therefore, Siana development remains on schedule to produce first gold in April 2011 - 10 months from now! Once the market appreciates that fact, along with the finance acceptance, the share price WILL move upwards, and I understand with considerable buying support from existing and other interested insto's leading the way!
My only concern now is whether the gold price will remain at these historically high levels, and I have already commented a number of times abut the benefits of hedging, despite many investors arguing against it. I believe that at a time when gold remains in a trading range that is so much higher than previous and way above cash costs of production, it allows considerable profit to be made if some proportion of gold is locked in. And I believe whilst it might be more marketable to say that the gold is locked in more flexible put/call options, I think that some level of gold forwards is much better due to the lower cost and the realisation that you can always roll them if not in the money! (And at todays gold price cash costs are a mere fraction of those prices!).
I have actually been buying more shares the past week Fastbuck1, as I am not deterred one bit by Stanley getting out. I thank him for his past efforts, I thank others for giving us the chance to push it up much higher from here on!
Who knows what Stanley's own personal situation is currently and what his cash requirements are. We do know that he bought at the bottom of the market and has made a stack of cash in the past couple of years. I also agree that at the time of the calamitous share price drop in late 2008 we all saw him as our saviour particularly as it appeared RED had lost its way, but actually he didn't do anything other than buy shares whereas at the time we thought he might use his shareholding to change the management at that time when we were not so happy with things. But those times are now well and truly behind the company, RED has completely changed in its status as we all now know and RED now enjoys a considerable increase in institutional support.
I have recently queried the company about the status of the finance, which I see is the only thing holding back any doubt as to whether the project will be developed within the next year, and I have had it confirmed, as have others, that all is on track with the bank offer.
I understand the final documentation on the debt finance offer is already very close to completion, and its likely the bank will be completing all things BEFORE the end of the July, but with some of the board traveling to N America soon and then Diggers and Dealers in early August the final acceptance of the finance might still be as I had understood it previously, to be the end of the first week of August. BUT there may well be a Trading Halt at the time of the bank offer so that such sensitive information is not leaked out, the only reason why that might not be called is if it will take more than 48 hours for RED to have the final bank offer vetted by a consultant.
I think its also important to consider that Stanley, whilst our past saviour, and a smart man with his previous investments such as Equigold etc, is not necessarily in a position to know any issues that could affect the future course of RED - he was instrumental in having Bolitho included on the board very recently but I suggest no board member would be crazy enough to ever jeopardise their position in providing sensitive information to any shareholder, particularly of the size of holdings that Stanley had!
Finally I understand that the development of Siana has NOT been delayed whatsoever with the way the development has proceeded, even though the bank finance has been put back the past couple of months.
RED board made the call that it would continue to fund the project, in a careful manner, from cash reserves prior to receiving the bank offer, and in any case, had no intention to draw down the bank portion of the funds until later to conserve costs of the borrowings (not that it amounts to much additional cost in the overall context of the funding). Therefore, Siana development remains on schedule to produce first gold in April 2011 - 10 months from now! Once the market appreciates that fact, along with the finance acceptance, the share price WILL move upwards, and I understand with considerable buying support from existing and other interested insto's leading the way!
My only concern now is whether the gold price will remain at these historically high levels, and I have already commented a number of times abut the benefits of hedging, despite many investors arguing against it. I believe that at a time when gold remains in a trading range that is so much higher than previous and way above cash costs of production, it allows considerable profit to be made if some proportion of gold is locked in. And I believe whilst it might be more marketable to say that the gold is locked in more flexible put/call options, I think that some level of gold forwards is much better due to the lower cost and the realisation that you can always roll them if not in the money! (And at todays gold price cash costs are a mere fraction of those prices!).
I have actually been buying more shares the past week Fastbuck1, as I am not deterred one bit by Stanley getting out. I thank him for his past efforts, I thank others for giving us the chance to push it up much higher from here on!
