West Coast Commentator

Yamana's Acquisition of Meridian and Northern Orion Finalized

What a waste of shareholder equity! As if we Yamana shareholders have not been hit hard enough by the Meridian-dilution-play - now the (reasonably good) prospects of developing Agua Rica are all the sudden off the table (Marrone's statement - the big guys Xstrata & Goldcorp seem to be less inclined to help this wanna-be to feed their mill to save moolah). The price tab for NTO just for the Alumbrera dividend? Ridiculous. There should be a review process!

Yamana-Northern Orion-Meridian Merger Doesn't Look Likely to UBS

Fortunately Yamana is getting it that we shareholders don't want to have our shareholder equity squandered away! What a hogwash to acquire another gold mining company half the size (and less than half the size in about two years, when Yamana's excellent development projects will produce over 3/4 of a million ounces a year) by giving away about half of the shareholder value to Meridian's shareholders!

By the way - Yamana management has sold out before that, what a "surprise". I'll be happy to invest more into Yamana, once the bought kingdom dreams have hit the wall and bloody-nose get back at what they do otherwise best: bringing mines into production on time and budget! That ability and the quality of their projects puts them on par with Barrick's track record and they can very well stand on their own. A factor 3 increase in the share price is definitely on the horizon once this happens. I'll just wait a bit, if there isn't another global equity selloff around the corner - that could be toxic in the near term (and taking even greater percentual profits off the table), the thunderstorm clouds are just too big right now, with $500bn adjustable mortgages hitting the repricing-fan this and next year...

Fortunately, too, that Yamana has hedged their copper from Chapada for three years (Trey Wasser had a comment about this on this side earlier) - they shouldn't be concerned of any "base-metal producer" discount any more. Also, that pays a couple times over for Chapada's construction cost, without being drawn in any base metal crash-vortex, once the realization sets in that less houses means also less cables and less factory expansions meaning less cables and... you get the picture. Gold is a currency and copper a consumable. Good luck, Northern Orion, in building a 38-mile long conveyor belt from "Aqua Rica" (what a mis-picked name) to Alumbrera on their own.

Fortunately (lucky three), Yamana cleverly did make the takeover conditional and will not be required to take than risk and additional copper exposure. Northern Orion puts, anyone? I'll stick with Yamana, an excellent executer with occasional Napoleon complex.