Please Note – Please don’t contact me asking for advice on OLE or any other market matter as I will only comment on the blog or other public forums. And for the love of God, don’t send or ask me about comments made on OLE, or for that matter, any other subject being discussed in some chat forum. I constantly warn you of the mostly ills one will suffer to take anything said there much pass a grain of salt. While I’m certain there are worthy posters and comments, much what is said there would never be noted if the poster had to openly declare who they are and face the consequences of any and all of their misleading, false and sometimes libelous comments.
So please, don’t waste your time and mind on asking for a response but note I always try to follow-up newsworthy factors good or bad.
This is my latest observation on OLE and it’s not only highly biased but also without the benefit of speaking with senior management of OLE for several days.
First and foremost, it’s important to remember that all we have at this time is a notice by Teranga Gold of an intention to make a formal offer to acquire the shares of OLE. Once we have it in writing, we can address it in more detail.
However, given what has unfolded since Taranga’s announcement of its intentions, I’ve concluded strictly on my own the following:
- As noted in their announcement, TGZ’s offer had already been turned down by OLE and others involved so the likelihood that the offer turned down will have changed much when the formal offer is received is slim. The assumption best to take based on this is OLE’s board will consider it inadequate.
- Bendon’s press release not only makes the OLE response a near certainty, but strongly suggests some key factors to consider:
1-Teranga Gold has not suddenly become interested in the JV project but as now been made known by TGZ themselves, has been on-going since December 2011. This may be little comfort for people like myself who were indeed correct to have bet on such a feat since then but what little comfort there is comes in the form that the horrific bear market in juniors is far more responsible for the OLE share price than anything else (another reason to ignore the misinformed, misguided and malicious posters that spend way too much time in chat forums and not in the real world).
2-TGZ’s offer was dead on arrival both legally (in their eyes) and value-wise and is suggesting to OLE shareholders that you aren’t getting back what the share of costs you put into the JV.
3- They implied others are interested, which can be casual and an attempt to sweeten the offer or be serious and suggest someone else will grab the prize if TGZ doesn’t raise its offer.
4- Perhaps the most critical comment they made came at the end of their release about their perceived government intentions.
- The actions by Teranga’s largest shareholder and the Bendon announcement suggest this not only has many different roads we can end up going down, but a seatbelt is a must accessary.
Bottomline – 30 years of experience tells me we’re only in the early innings of this and more surprises are a possibility. Most of the outcomes should be a net positive but after this grueling and torturous bear market in juniors, the ability to even be a spectator is hard and some will simply cash out. This may make things look weaker than they really are but even I can’t argue with the thought of one day not having to think of OLE the moment I wake up and as I try to fall asleep.
Stay tuned.