What the hell is going on with Bellevue?

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Righto money monitors.
We've got some gold fodder to

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bloody feed the episode today,
bought to you by Quattro Project

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Engineering.
Who else would you pick?

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Well, we'd pick seven others
actually, but yeah.

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Not BBC mate, I've already
picked Quattro.

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That that this is true but like
I could pick any partner for a

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great episode because they're
all great but.

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The stars have lined up for this
one, though.

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Quattro project Engineering.
When you're talking about gold,

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talking about getting these
projects, would that be

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underground or whatever you
want?

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Quattro Project Engineering.
Right.

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They're at Underground Operators
Conference along with myself.

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In a couple of weeks they're
going to have a big tent down

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and say G'day to Jeremy Palmer
and the team about all your APC

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design engineer construct needs.
Their friggin gurus.

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And he's about to give a bit of
a guru analysis on gold Rd. gold

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fields.
Mate, I love a hostile.

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I love a hostile deal this is.
When it's a big mob like that

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too.
Oh, that you wouldn't think a

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guy hostile.
It sends tingles down a spine.

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I'm frothing just thinking about
it.

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I'm probably getting tingles.
Outside so keen to talk about

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it.
Oh, and of course, and tell you

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what, bloody action-packed
yesterday on the Bellevue front.

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And we haven't got all the info
yet, but obviously we're gonna

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give a what we know what we
infer, and there's a bit

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happening there.
So that'll be the back half.

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So right away, Goldfield's Gold
Rd. we mentioned it briefly the

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other day, the article coming
out.

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There's been plenty of news
coverage and comments from

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executives involved in this.
And boys, how do we want to map

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it out?
Should we go through a bit of a

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timeline?
Yeah, Maddie, run through a bit

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of a, a timeline because it's
really interesting to reflect a

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bit on the there's like been a
slight change in tone.

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I think we've picked up on, on
how they're talking about it.

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But you know, it, it came out
earlier this week, but clearly

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the companies were in
discussion.

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So run us through quickly how it
seems from the outside things

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transpired.
Yeah, like in the news stories,

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I think they've evolved a bit.
Like there was questions at the

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start about no, like not being
not engaging, but then there's

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like admissions of engagement
and between the companies and

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like this is I guess what we
know so far.

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So apparently on 7th of March,
Mike Fraser, the head of

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Goldfields, he sent the NBIO to
Tim Necha at Gold Rd. chair.

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Yep.
And then so that was followed

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by, and this is for all of Gold
Rd.

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It's not like some people
thought it was just for Grey.

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This is for to take Gold Rd. out
now.

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This was followed by a phone
call in a like guess a a week to

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consider the offer and at some
point during that like

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Goldfield's Gold Rd. rejected
the NBIO and then their counter

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offer was what was disguised in
the announcement that they

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wanted to buy 50% of grey air
off Goldfields.

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And that's a pretty interesting
counter offer, isn't it?

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Yeah, it's like.
It's like, it's like not right

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there.
It's not like we want more cash.

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It's like, no, no, no.
You buy me, I'll buy you.

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And so anyway, Goldfields to
climb that counter offer, which

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I said in the announcement and
then Mike Fraser from head of

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Goldfields, he apparently flew
to Perth sort of 19th, 20th of

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March to friendly negotiated the
deal requested and that was like

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requested by a team.
So I was all like looked,

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sounded all right there and met
on consecutive days which the

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West that was in the West
Australian article as well.

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And they sounds like they got a
commitment that they'd sort of

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be back to him by Sunday 23rd.
Yeah, which was previous just

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the Sunday just gone and here's
there might have been a bit of

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stalling and nothing sort of
coming back and nothing.

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And it got to the stage where
Goldfields had a board meeting

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on the apparently had a board
meeting on the Sunday and said

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they were going, it just wasn't
really didn't look like it was

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progressing towards an answer.
And they essentially said they

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were going live with it
tomorrow, which is when we,

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yeah, talked about it on the
Monday just before the show.

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So that is what we think we
know.

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And the, the strategy is they've
like gold fields themselves have

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disclosed the fact that they've,
they've confidentially submitted

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this bid and this is the price
and these are the terms.

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And, and as Duncan Gibbs will
proudly tell the press, that's a

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bear hug strategy in the
investment banking circles,

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which you don't, you don't see
many of these.

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Like even in the yeah.
Like I'm, I'm trying to think of

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the last one I saw in the
resources space.

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I thought metals X ones when
they did that, when they when

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they talked about their one of,
of green tech was sort of like a

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bear hug.
But I actually just think it was

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a compliance thing.
They weren't trying to pressure

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an outcome there.
Yeah, yeah.

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Before that deep yellow Vimy is
the last one I remember Oh yeah

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yeah which did lead to an
outcome but I did think it would

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be worthwhile kind of just
reflecting on the on the

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funkiness of of the joint
venture like like this is an

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obvious consolidation I mean
look Gold Rd. have a non

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controlling joint venture
interest inquiry yeah Goldfields

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is operator.
Surely surely there'd been like

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plans that it's a logical
consolidation.

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Why hasn't it happened before
And I and I think it's just

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worth reiterating that no deal
has has happened to date and I

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think a big part of that is the
joint venture agreement included

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a standstill that prevented gold
fields from acquiring any

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further interest in gold roads.
So in practice say gold fields

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wants to do a deal maybe
historically maybe they submit

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an MBIO confidentially and gold
Rd. could theoretically keep

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knocking them back over and over
and and what gold fields like

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what are they to do in that
situation?

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They can't they can't buy a
private spike and kind of exert

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pressure and in instead gone
away that you know, there's a

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stance to preventing them from
from from doing that.

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So you want to do a friendly
deal.

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It's like the the you know,
everyone wants to a friendly

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deal if they can do a friendly
deal.

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And I've never seen gold fields
roll out a hostile tactics

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before.
So I I kind of thought that they

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were too neutral and kind of
have it in them to to even do

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this playbook in some some
respects.

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But senior management at the at
the company has changed in the

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last year or so.
And maybe maybe if they're going

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about things differently now,
you know, instead of accepting

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the stalemate that they're in
because of the the standstill in

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the JV agreement, they're
actually willing to get their

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hands dirty and roll out the
public pressure that comes with

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this bear hug kind of hostile
playbook.

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Yeah.
Well, and like it looks at the

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looks like from there and the
efforts were made to make it

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friendly, like they flew over to
discuss it.

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And like that if if you look at
the timeline, it's effectively

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gone from that MBII being
submitted, it's gone 2 and a bit

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weeks.
Do you think that's is that a

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time you'd think, oh, this is
going on too long now we're

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going to go hostile on this or
doesn't seem to be too long.

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Time can kill deals, but I don't
think that's how things played

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out.
I mean, I think the they put

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they put a number on the table
and if if gold roads like

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response to that is this number
is not enough.

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Well, clearly the discussions of
the two days was well, you're

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going to have to tell me a
number that is appropriate and

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then we can work from there and
if.

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They they've obviously come over
to negotiate.

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Yeah.
And if they haven't been given a

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number in that two days, like,
you know, you're kind of just

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you're, you're just like, well,
this a minor situation where I'm

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I, I like I'm, I'm, I'm kind of
get a deal done because you're

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not going to give me a number to
negotiate from.

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Yeah, that's it.
It's a valid It's a valid reason

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to to to employ a bear hug if
that's what's happened.

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I, I found a very, very
interesting the, if you look at,

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I'll bring the quarterly up just
to one of the Gold roads

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previous announcements, you'll
see at the bottom it says this

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release has been authorised by
the board.

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And you look at the release
about the this MBIO, it said

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this release was authorised by
Duncan Gibbs, the MD and CEO,

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not authorised whether that's
reading into things too much.

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But the question is, Duncan
being a, he had I think well

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over a decade of experience in
as GM for Tropicana Sunrise.

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So he's been operational before.
Whether he has his intention is

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like wanting to run a mine
versus possibly other people on

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the board or shareholders that
would rather take the cash and

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if there's any division there, I
don't know, but.

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Yeah, yeah.
It's interesting to yeah to to

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think about the strategy Trevs
you as you touched on the other

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day in light of how gold fields
have gone about M and a very

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recently with a Cisco.
Yeah, it is it.

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So you, you do the bear hug and
then what you're hoping for is

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that there's a bunch of a bunch
of Gold Rd. shareholders who

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were who were suddenly kind of
like, oh, hang on, I want this,

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this looks pretty good.
And they pick up the phone and

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they put a bunch of pressure on
the, the, the board and

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management of the company to
meaningfully engage and

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negotiate a value of creative
outcome here.

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And sometimes that's kind of
needed if you're, if you're

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facing, you know, a pretty, a
pretty brick wall approach

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otherwise.
And, and I think it's, I think

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it's working like, and I applaud
it from from gold fields.

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You could you could I've read
this one quote in the Wall

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Street Journal article where
where Duncan is quite quoted

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saying that this was the only is
this is the only offer received

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to it says goldfields has to
date only put forward 1 proposed

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1 proposed price, says Gibbs.
There's been no to and fro here

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in terms of price discussion.
It take it's take it or leave

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it, he said.
And, and then that's going

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straight into a public arena.
So I've read that.

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And like Duncan's suggestion is
that they haven't received a bid

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before.
And while that might technically

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be correct, referring to the
situation like right right now,

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this, this sort of period in
time, I, I would find it like

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hard to believe that Gold Rd.
has never received an NBIO from

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gold fields over the 10 years
that the two companies have have

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been joint venture partners for.
I'd love to to ask the question,

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you know, to to people in the
North Gold Rd. over the last 10

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years, how many bids has has
gold fields, you know,

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confidentially submitted, like
how many MB iOS have kind of,

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you know, been tended to to a
chairman over the period of the

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last decade?
I'd love to know the answer to

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that.
And we we're not going to get an

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answer to that if we asked it,
But I'll pose it not because I'm

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like, you know, like I, I know
the answer, but but more because

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I'm doubtful that that
Goldfield's plan I used to is to

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roll out a hostile playbook.
Everyone wants to do a friendly

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deal, friendly deals, like way
easier to get get done, you

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know, cheaper.
It's it's, it's just like you

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don't you don't go hostile just
because just to be a Dick.

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I mean, maybe some people might,
but it's, it's a bit like it's

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a.
Anyway, all this is coming.

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If you want to, if you want to
go hostile to be a Dick, you do

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it on Christmas Eve.
Yeah, yeah.

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But they but they're like, I'll
go through some of the comments

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in the the West and everything
like because it's it's this is I

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assume it says Oh yeah, the
chief of gold Rd. has accused.

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00:11:02,440 --> 00:11:04,240
Yeah, yeah.
So this obviously Duncan Giggs

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comments talking about
goldfields at best a bumbling

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joint venture partner.
The stance they've adopted is

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very hostile and aggressive.
It's a lowball price given it

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comes not long after a
production downgrade at career

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and before an much anticipated
underground mining study.

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So it's yeah pretty anyway.
Well, it's not a friendly deal

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now after you slagging them in
the paper, but they but the

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yeah, talking about
opportunistic when it's like all

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time the degray outcome has been
achieved.

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It's all time high share price
and Oh no, it's functioning the

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00:11:39,840 --> 00:11:45,720
gold price, but it's it's just
yeah, it's a it's I think it's

224
00:11:46,240 --> 00:11:48,880
it says something that the price
hasn't got to the offer price

225
00:11:48,880 --> 00:11:49,680
yet.
The share price.

226
00:11:49,680 --> 00:11:51,680
It doesn't mean I don't think
it's cracked $3 yet.

227
00:11:51,680 --> 00:11:52,960
The.
The the the points you make

228
00:11:53,000 --> 00:11:54,520
there, they're actually. 3 bucks
today.

229
00:11:54,520 --> 00:11:57,200
They're actually valid points to
make, like.

230
00:11:57,480 --> 00:11:59,440
I don't think that they're not
valid points to make.

231
00:12:00,960 --> 00:12:05,920
I I just think they kind of, you
know, there's, there's yeah, a

232
00:12:05,960 --> 00:12:08,240
bunch of other contexts that
makes you kind of, you know,

233
00:12:09,040 --> 00:12:12,160
yeah, wash, wash your, your eyes
over it a little bit because it

234
00:12:12,240 --> 00:12:15,120
yeah, if there's, if there is a
study to come out that I think

235
00:12:15,120 --> 00:12:17,400
there's more value than like
that being in the public domain

236
00:12:17,400 --> 00:12:20,000
of course, let's you negotiate
more value as well.

237
00:12:20,280 --> 00:12:23,920
I think that's a valid point to
make, but the lack of engagement

238
00:12:23,920 --> 00:12:26,320
would be frustrating for for God
Roy shareholders entirely.

239
00:12:26,400 --> 00:12:27,560
Yeah.
And I think it, but it's more

240
00:12:27,560 --> 00:12:30,320
their their their counter offer,
which is like it's this like OK,

241
00:12:30,320 --> 00:12:36,080
take 3 approximately $3 seven
per share cash or we are going

242
00:12:36,080 --> 00:12:40,480
to go down the road of debt
capital raises and stuff to buy

243
00:12:40,480 --> 00:12:43,760
50%.
So as the the shareholders and

244
00:12:43,840 --> 00:12:48,760
which are like BlackRock 5%.
Van Eck owns 9 and a bit that'd

245
00:12:48,760 --> 00:12:51,800
be, I think that'd be, as you
said, very a bit of pressure

246
00:12:51,800 --> 00:12:55,920
going on about, hey, come on, is
this the best thing for us?

247
00:12:56,520 --> 00:12:59,320
Yeah, the the relationship Gold
Rd. seems to have with it's

248
00:12:59,320 --> 00:13:02,400
investor base is like
interesting to say the least.

249
00:13:02,400 --> 00:13:06,920
I mean, you guys remember the
reaction after the rumours with

250
00:13:06,920 --> 00:13:10,680
them wanting to get a stake in
the windfall asset last year and

251
00:13:10,680 --> 00:13:12,720
how the market kind of spat the
dummy and stuff?

252
00:13:12,760 --> 00:13:15,000
Greenstone asset.
Greenstone.

253
00:13:15,040 --> 00:13:18,120
Yeah, exactly.
Yeah, Yeah, it's, you know the

254
00:13:18,160 --> 00:13:20,760
the market didn't like that they
didn't like the company going

255
00:13:20,760 --> 00:13:24,360
out and being keen on M&A.
And so it doesn't seem like the

256
00:13:24,520 --> 00:13:29,320
most cordial relationship, but
yeah, yeah, B And then to see

257
00:13:29,320 --> 00:13:31,160
what those and.
Investors, like investors.

258
00:13:31,160 --> 00:13:36,760
There's not like huge sort of
like active money there, if you

259
00:13:36,760 --> 00:13:38,360
know what I mean.
Like a lot of it's the yeah,

260
00:13:38,360 --> 00:13:40,440
absolutely.
The kind of passive captive

261
00:13:40,720 --> 00:13:43,560
passive ETS, passive, passive
dumb kind of money in a lot of

262
00:13:43,560 --> 00:13:45,800
ways.
Yeah, what the?

263
00:13:46,160 --> 00:13:48,440
The Cisco, the Cisco thing you
mentioned windfall.

264
00:13:48,640 --> 00:13:51,640
So this was this was the other
point I wanted to to, to make on

265
00:13:51,640 --> 00:13:54,040
the the the context with gold
fields.

266
00:13:54,040 --> 00:13:55,920
Why I don't think like they're
the sort of company that's just

267
00:13:55,920 --> 00:13:57,960
going to go hostile without a
reason.

268
00:13:58,840 --> 00:14:01,920
If you if you look at when they
acquired a Cisco last year and

269
00:14:01,920 --> 00:14:05,080
this was late last year, you can
read the information circular

270
00:14:05,280 --> 00:14:11,160
and Cisco super similar kind of
like situation to to go Gold Rd.

271
00:14:11,520 --> 00:14:13,200
It was a 5050 JV with
Goldfields.

272
00:14:13,480 --> 00:14:15,720
They bought it out of Cisco to
consolidate the windfall

273
00:14:15,720 --> 00:14:19,280
project.
They upped their bid four times.

274
00:14:19,280 --> 00:14:22,640
So it was 5 separate valuations
provided to a Cisco and that all

275
00:14:22,640 --> 00:14:24,640
happened behind closed doors
never leaked.

276
00:14:24,640 --> 00:14:26,720
You know, there's no like that
was just like meaningful

277
00:14:26,720 --> 00:14:29,280
dialogue.
So it like golfers is clearly a

278
00:14:31,440 --> 00:14:34,800
dog miner in my eyes that is is
willing to negotiate on value.

279
00:14:34,800 --> 00:14:38,440
They just have to have a
receptiveness on that

280
00:14:38,440 --> 00:14:41,880
negotiating in that negotiating
dialogue is is is how I would

281
00:14:41,880 --> 00:14:43,520
interpret it.
And especially when there's been

282
00:14:43,520 --> 00:14:48,280
a baseline set of 3 bucks 7 this
is we're willing to buy this and

283
00:14:48,960 --> 00:14:51,120
go up a bit.
Yeah, I'll fly over and see you.

284
00:14:52,120 --> 00:14:54,800
But what what do you think about
the the valuation?

285
00:14:54,920 --> 00:14:57,640
This is it.
Is it opportunistic?

286
00:14:59,760 --> 00:15:02,360
Yeah, it's, I mean it's a super
interesting question, right?

287
00:15:02,360 --> 00:15:07,160
Like obviously the, the value to
to gold fields is superior to

288
00:15:07,160 --> 00:15:09,440
than anyone else because they
are the JV partner.

289
00:15:09,440 --> 00:15:11,640
Maddie, if you, if you look at
the price, we're talking about

290
00:15:11,640 --> 00:15:18,000
3.3 billion Aussie, you've got
the degray stake at like 870 ish

291
00:15:18,240 --> 00:15:23,040
million in there and then
another call it 180 million in

292
00:15:23,040 --> 00:15:25,080
cash.
But I mean, we should probably

293
00:15:25,080 --> 00:15:27,960
pause on the Degray stake for a
minute given like there's

294
00:15:27,960 --> 00:15:30,800
various assumptions in what
happens going, going from there,

295
00:15:30,800 --> 00:15:32,720
right?
Yeah, well, even the the

296
00:15:32,720 --> 00:15:35,720
structure it's just worth worth
teasing out.

297
00:15:35,960 --> 00:15:38,160
So what gold food is offering is
an all cash offer, but there's a

298
00:15:38,160 --> 00:15:39,920
fixed component and a flexible
component.

299
00:15:40,200 --> 00:15:42,120
Fixed component is 2 bucks 27
cash.

300
00:15:42,120 --> 00:15:44,880
The variable component is
another 80 ish cents.

301
00:15:44,880 --> 00:15:49,000
But that's variable depending on
the implied valuation of of the

302
00:15:49,000 --> 00:15:52,440
de grey stake, you know?
Which is what Northern Star

303
00:15:52,440 --> 00:15:54,120
trades out effectively.
Exactly.

304
00:15:54,120 --> 00:15:57,400
So they, they, they framed the
premium in in a few different

305
00:15:57,400 --> 00:16:02,840
ways in gold, gold fields letter
that they put out and gold Rd.

306
00:16:02,840 --> 00:16:07,200
they focus on this 28% premium,
which sounds like, you know,

307
00:16:07,200 --> 00:16:10,360
not, not not huge, but that's
the wrong way to interpret this

308
00:16:10,360 --> 00:16:12,280
premium.
This is a 44% premium.

309
00:16:12,520 --> 00:16:15,000
You shouldn't be including the
value of of the degrade shares

310
00:16:15,000 --> 00:16:17,200
in your premium calcs.
Yeah, just like no one wants to

311
00:16:17,200 --> 00:16:20,840
pay a premium on cash, you know,
like you, you sort of like, you

312
00:16:20,840 --> 00:16:22,280
know, you're not paying a
control premium on cash.

313
00:16:22,280 --> 00:16:23,840
Well, it's the same here with
the Degray stake.

314
00:16:23,840 --> 00:16:26,960
Like the, the way that that Gold
Fields has gone about this, it

315
00:16:27,080 --> 00:16:30,040
really just removes any, any
sense of a strategic premium

316
00:16:30,040 --> 00:16:32,680
associated with that Degray
stake.

317
00:16:32,680 --> 00:16:34,640
And you should net that off.
This is a, this is a, you know,

318
00:16:34,840 --> 00:16:39,240
a 44% premium and that's, it's
kind of like a pretty, a pretty

319
00:16:39,240 --> 00:16:41,400
generous starting position in
negotiations I would have

320
00:16:41,400 --> 00:16:43,120
thought.
So, so they're, they're

321
00:16:43,120 --> 00:16:47,360
definitely they're effective.
Are they effectively saying that

322
00:16:47,360 --> 00:16:51,600
they would pay Goldfield's
approximately 2 1/2 bill for

323
00:16:51,600 --> 00:16:55,080
their 50% stake?
So if they're if they want to.

324
00:16:55,840 --> 00:16:59,880
Call it 2.2 ish.
Two point about 2.2.

325
00:17:00,440 --> 00:17:06,000
Yeah, and and Gold Rd. reflected
that by saying we'll counter and

326
00:17:06,000 --> 00:17:09,160
bid 2.3 for your half.
Oh, did they say?

327
00:17:09,160 --> 00:17:13,280
Did they give a quantity a a a
size that they they would put

328
00:17:13,280 --> 00:17:15,240
in?
I'm pretty sure they did, yeah.

329
00:17:15,560 --> 00:17:16,359
Right.
Oh yeah.

330
00:17:17,000 --> 00:17:20,319
Yeah, which was obviously
bounced back by by Goldfields,

331
00:17:20,319 --> 00:17:23,319
but yeah, to what you said,
Trevor.

332
00:17:23,319 --> 00:17:26,359
I think it is a pretty, pretty
generous starting point on where

333
00:17:26,359 --> 00:17:30,440
the market had kind of been
valuing Gold Rd. previously.

334
00:17:30,720 --> 00:17:33,840
And yeah, and then talking about
the Northern Star, there's

335
00:17:34,200 --> 00:17:37,680
obviously a few different
potential ways that can play out

336
00:17:37,680 --> 00:17:40,360
assuming say Northern Star, it
becomes Northern Star shares

337
00:17:40,360 --> 00:17:44,200
rather those degree shares turn
into Northern Star shares.

338
00:17:44,880 --> 00:17:47,600
They have discussed in the past
maybe an in specie distribution

339
00:17:47,880 --> 00:17:51,880
if they want to turn that into
cash and look at M&A or

340
00:17:51,880 --> 00:17:54,160
something like that, which
they've sort of been eager to do

341
00:17:54,160 --> 00:17:56,280
in the past.
There's a tax implication as

342
00:17:56,280 --> 00:17:57,840
well.
Yeah.

343
00:17:57,840 --> 00:18:02,280
And like that's a Gray stake.
I do think it's it's, it's

344
00:18:02,280 --> 00:18:04,480
actually a point that not, not
no one's really talking about, I

345
00:18:04,480 --> 00:18:06,760
don't think.
But there's the, the value of

346
00:18:06,760 --> 00:18:09,560
gold Rd. stake in degree as
well, like 890,000,000, you

347
00:18:09,560 --> 00:18:12,440
know, plus or minus depending
on, on, on any given day, if

348
00:18:12,440 --> 00:18:14,920
they, if they sold that stake at
any point, there's a very chunky

349
00:18:15,120 --> 00:18:17,400
capital gains tax that they're
going to have to pay.

350
00:18:17,400 --> 00:18:21,040
And on my, my Bush math numbers,
that tax is about $150 million

351
00:18:21,280 --> 00:18:24,720
in tax that they'd have to pay
on the monetization of, of that

352
00:18:24,720 --> 00:18:28,240
stake in degree.
And no, no gold fields like in

353
00:18:28,240 --> 00:18:31,560
their, in their offer, they,
they are generously haven't even

354
00:18:31,560 --> 00:18:36,440
applied a deduction in the
variable component of the offer

355
00:18:36,440 --> 00:18:39,680
for gold Rd. of the tax that
would be payable here for them

356
00:18:39,680 --> 00:18:41,280
to to monetize it, right?
They're actually, they're going

357
00:18:41,280 --> 00:18:44,000
to pay 100 cents on whatever the
value of the degree stake is,

358
00:18:44,200 --> 00:18:47,840
even though for gold Rd. if they
were to, to monetize that there

359
00:18:47,840 --> 00:18:49,960
is a, a payable tax.
I think what's actually

360
00:18:49,960 --> 00:18:52,520
realizable is what you get after
tax and that's kind of what's

361
00:18:52,960 --> 00:18:54,120
gonna be attributed
shareholders.

362
00:18:54,120 --> 00:18:56,320
They were, yeah.
Yeah, if they were to sell the

363
00:18:56,320 --> 00:18:58,920
shares.
Precisely so you know for gold

364
00:18:58,920 --> 00:19:03,360
Rd. think about what that means
for for them in terms of like

365
00:19:03,360 --> 00:19:05,640
you're comparing your different
alternative strategies and and

366
00:19:05,640 --> 00:19:08,360
what Gold Rd. pen was.
Oh no, we'll monetise our stake

367
00:19:08,360 --> 00:19:10,840
and we'll buy you out.
Well, OK, so now, now you've,

368
00:19:11,280 --> 00:19:15,400
you're actually you're having a
punitive impact on, on your on

369
00:19:15,400 --> 00:19:17,400
your value because of the tax
implications there.

370
00:19:17,640 --> 00:19:19,000
Then what he's kind of tabled to
you.

371
00:19:19,000 --> 00:19:21,200
It's.
And if, if gold Rd. were to

372
00:19:21,200 --> 00:19:24,320
achieve like a a like for like
outcome on just the, the, the

373
00:19:24,320 --> 00:19:28,080
see through value situation of,
of that offer to pay 100 cents

374
00:19:28,080 --> 00:19:30,360
on it, which is, which is what
you know, Golden fields are

375
00:19:30,360 --> 00:19:33,200
saying they'd have to sell the
stake for like 20% higher than

376
00:19:33,760 --> 00:19:35,200
degrade shares of trading right
now.

377
00:19:35,200 --> 00:19:37,560
And no one's going to buy the
strategic static at a 20%

378
00:19:37,560 --> 00:19:39,440
premium.
And, and I think like it's, it's

379
00:19:39,440 --> 00:19:41,800
actually quite a clever thing
that the gold fields have done

380
00:19:41,800 --> 00:19:44,200
because I've really just like
pulled the pin on the on the, on

381
00:19:44,200 --> 00:19:46,680
the argument that there's any
kind of, you know, premium or

382
00:19:46,680 --> 00:19:48,840
strategic value sort of
associated with the, with the,

383
00:19:48,880 --> 00:19:51,360
with the degree stake there.
Yeah.

384
00:19:53,040 --> 00:19:54,880
Yeah, yeah.
And I mean, if we expand the

385
00:19:54,880 --> 00:19:58,080
conversation on on valuation,
just going beyond that that

386
00:19:58,080 --> 00:20:00,840
stake and look at the actual
cash flows that the business

387
00:20:00,840 --> 00:20:04,040
does, because I think, you know,
I find this the the most

388
00:20:04,040 --> 00:20:06,600
interesting part of it.
Like we're talking about a

389
00:20:06,600 --> 00:20:09,520
company that did like
$90,000,000 in free cash flow in

390
00:20:09,520 --> 00:20:12,280
2024.
They haven't knocked the lights

391
00:20:12,280 --> 00:20:15,280
out in, in terms of cash flow in
recent years and obviously they

392
00:20:15,280 --> 00:20:18,400
can point the finger at
Goldfields for that being the

393
00:20:18,400 --> 00:20:21,880
case.
But yeah and and maybe there is

394
00:20:21,880 --> 00:20:24,840
additional synergies and that
the the cash print is a bit

395
00:20:24,840 --> 00:20:28,520
better if it's all in one case.
But if you look at 2025, they're

396
00:20:28,520 --> 00:20:33,800
guiding to 170,000 oz at Aussie
2 and a half, $1000 all in

397
00:20:33,800 --> 00:20:35,480
sustaining costs.
So.

398
00:20:35,760 --> 00:20:38,120
That's their half, half, half of
the project.

399
00:20:38,640 --> 00:20:41,240
Yeah, that that's their half
which they maintained guidance

400
00:20:41,240 --> 00:20:45,000
despite the the incident that
sort of happened a month or so

401
00:20:45,080 --> 00:20:47,040
ago.
So they've they've held that.

402
00:20:47,040 --> 00:20:50,800
But if you do kind of back of
the envelope that's like $200

403
00:20:50,800 --> 00:20:55,160
million in in cash flow before
other kind of expenses.

404
00:20:55,160 --> 00:20:59,760
So like we said maybe like two
2.2 ish billion it it looks

405
00:21:00,000 --> 00:21:03,800
pretty, pretty reasonable on
those sorts of grounds.

406
00:21:03,800 --> 00:21:07,440
And to be clear, they've given
their three-year strategy and

407
00:21:07,440 --> 00:21:10,600
they've flatlined production.
So it should maintain the same

408
00:21:10,600 --> 00:21:14,640
level for the next three years.
We'll see what kind of cost do

409
00:21:14,640 --> 00:21:18,560
they did say kind of through 26
they should improve a little bit

410
00:21:18,560 --> 00:21:21,400
once they've done done a bit of
strip and and a few other bits

411
00:21:21,400 --> 00:21:25,640
and pieces.
But yeah, you then need to go

412
00:21:25,640 --> 00:21:27,960
one step further and and think
about growth, right, Because the

413
00:21:27,960 --> 00:21:32,840
open pit is going to be mined to
2032 as it currently kind of

414
00:21:32,840 --> 00:21:34,480
stands.
And there's all this discussion

415
00:21:34,480 --> 00:21:37,880
about the underground study.
Now this is a, an all body that

416
00:21:37,880 --> 00:21:42,560
runs in the, in the low 1g per
ton type thing, you know, maybe

417
00:21:42,560 --> 00:21:46,000
1.31.4.
There's an, there was previously

418
00:21:46,000 --> 00:21:51,880
an underground resource there
that stood at just under 1.6g

419
00:21:51,880 --> 00:21:54,560
per ton.
The, the overall ounces in the

420
00:21:54,560 --> 00:21:57,640
underground component were
reduced last time they came out

421
00:21:57,640 --> 00:22:01,160
with their R&R statement because
they dropped the pitch shell a

422
00:22:01,160 --> 00:22:04,680
bit deeper given the kind of
friendly gold environment that

423
00:22:04,680 --> 00:22:06,440
we're experiencing at the
moment.

424
00:22:06,440 --> 00:22:09,360
But I mean, maybe one more for
you, Maddie, where do you kind

425
00:22:09,360 --> 00:22:15,840
of see a 1.58g per tonne ore
body, you know, being mined

426
00:22:15,840 --> 00:22:17,440
underground?
Do you see that as feasible?

427
00:22:17,440 --> 00:22:20,400
I mean, granted, this is like a
twenty 30s type discussion and

428
00:22:20,400 --> 00:22:23,440
maybe the the environment is a
bit friendly and we can, you

429
00:22:23,440 --> 00:22:27,920
know, forget that 2G per ton.
It ticks lower and lower, but

430
00:22:28,840 --> 00:22:32,240
it's yeah, it it seems to be
rather at the at the low end in

431
00:22:32,240 --> 00:22:33,280
in my view.
What do you reckon?

432
00:22:33,400 --> 00:22:36,560
Yeah, it's, it's all a all a
scale thing.

433
00:22:37,480 --> 00:22:41,800
I know you know the, the narrow.
I think, I think it was Bryce

434
00:22:41,800 --> 00:22:44,680
talking about it on the AI chat
talking, talking about how the

435
00:22:44,720 --> 00:22:48,720
all the open pits have been
discovered in mine and

436
00:22:48,720 --> 00:22:49,920
everything's going on
underground.

437
00:22:49,920 --> 00:22:53,800
It's, it's, you'd notice a lot
of the exploration now, like

438
00:22:54,520 --> 00:22:58,400
there's shit loads of open pits
because grades are everything's

439
00:22:58,400 --> 00:23:02,720
there and it's now being mined
at much different prices.

440
00:23:02,720 --> 00:23:06,280
So all our grade calcs that we
used to do just don't make sense

441
00:23:06,280 --> 00:23:07,880
anymore.
Cut off grade gets lowered.

442
00:23:07,960 --> 00:23:11,120
Yeah, it used to.
It used to be 4G had to be 4G

443
00:23:11,120 --> 00:23:13,320
for an underground, 2G for an
open pit.

444
00:23:13,680 --> 00:23:18,120
And now that's just halved.
So you can I, I don't see it as

445
00:23:18,360 --> 00:23:22,160
out of the realm of possibility
at all by 20-30 that you could

446
00:23:23,240 --> 00:23:27,240
make a, a 2,000,000 tonne
underground operation at 1.6 and

447
00:23:27,240 --> 00:23:31,240
B significantly profitable, but
with the scale of those ones

448
00:23:31,240 --> 00:23:34,680
requires a lot of capital to get
it to that stage.

449
00:23:34,680 --> 00:23:39,960
So 20-30 could be printing cash
by 2035 for instance, to develop

450
00:23:39,960 --> 00:23:42,760
the infrastructure.
Yeah, and and you, but you want

451
00:23:42,760 --> 00:23:45,040
to be a bit conservative as
well, right.

452
00:23:45,040 --> 00:23:49,280
Like you guys remember the the M
and a discussion we we recorded

453
00:23:49,280 --> 00:23:53,680
just a, a couple of weeks ago
and all the deals around 2012

454
00:23:53,960 --> 00:23:56,560
that were there were people
factoring in what the gold price

455
00:23:56,560 --> 00:24:00,400
had done in the last year.
You know, re redoing the, the

456
00:24:00,400 --> 00:24:02,680
block models and everything and
the, the pitch shells and

457
00:24:02,680 --> 00:24:05,160
everything and things reversed
very quickly.

458
00:24:05,160 --> 00:24:08,320
You know you want to be
relatively conservative.

459
00:24:08,320 --> 00:24:10,280
It's it's a big, it's a big
consistent ore body too.

460
00:24:10,360 --> 00:24:12,040
It's not.
Like yeah, I was about to ask,

461
00:24:12,040 --> 00:24:14,200
is it a bit chunky?
It's not like narrow fame where

462
00:24:14,200 --> 00:24:15,920
you've got all that dilution,
all that sort of stuff.

463
00:24:15,920 --> 00:24:18,720
So the great on a you know, vis
a vis you know.

464
00:24:18,720 --> 00:24:20,240
Yeah, yeah.
And you're and you're just,

465
00:24:20,240 --> 00:24:23,120
you're getting absolutely,
you're just getting better bang

466
00:24:23,120 --> 00:24:25,920
for buck for your infrastructure
that you have to put in.

467
00:24:25,920 --> 00:24:27,760
You can monitor at a higher
rate.

468
00:24:27,760 --> 00:24:31,360
So you know, yeah, you can,
yeah, you definitely take you

469
00:24:31,440 --> 00:24:35,360
you're better mining 2,000,000
tonnes at 1.6 and 1,000,000

470
00:24:35,360 --> 00:24:39,440
tonne at 1.9 or two.
Like it's just just lower grade,

471
00:24:39,440 --> 00:24:41,680
but just more of it that can
better cost.

472
00:24:42,000 --> 00:24:44,440
So yeah, no, it's definitely
yeah these.

473
00:24:45,040 --> 00:24:48,320
Yeah, they are.
My historical knowledge is good.

474
00:24:48,320 --> 00:24:50,680
Fuck all these days because the
prices are so different.

475
00:24:52,000 --> 00:24:55,120
The there is a bit of a kicker
in there as well from about next

476
00:24:55,120 --> 00:24:58,640
year, as soon as like they've
hit that 2 million oz that has

477
00:24:58,640 --> 00:25:02,400
come out, the ore body gold Rd.
is going to get a 1.5% royalty.

478
00:25:02,400 --> 00:25:06,800
So that does make their their
half quite a bit friendlier.

479
00:25:06,800 --> 00:25:09,800
That's that's a nice to have
thing that was in the deal a

480
00:25:09,800 --> 00:25:12,520
while back.
So yeah.

481
00:25:12,520 --> 00:25:15,840
And and to to round out on where
the the broker community and

482
00:25:15,840 --> 00:25:18,000
where consensus kind of sits
like they're trading close to

483
00:25:18,000 --> 00:25:22,040
1.1 times NAV.
So, you know, you can always

484
00:25:22,040 --> 00:25:24,880
make the the argument and heaps
of people make it that the

485
00:25:24,880 --> 00:25:27,560
consensus process flushed
through is way below where we

486
00:25:27,560 --> 00:25:29,800
are.
And and it doesn't factor in the

487
00:25:29,800 --> 00:25:33,960
optionality in in all bodies
like this that are a Long live

488
00:25:33,960 --> 00:25:36,040
and staff so.
Would that not include the

489
00:25:37,000 --> 00:25:40,400
underground yet, like and
because there's no MPV on it?

490
00:25:40,400 --> 00:25:42,560
Or, or there'd be a there'd be.
A.

491
00:25:42,560 --> 00:25:45,280
Because we put.
It on yeah, yeah.

492
00:25:45,280 --> 00:25:47,600
Yeah, Yeah, they'd be talking
about it.

493
00:25:47,600 --> 00:25:50,840
And this goes back to what I
sort of said at the beginning

494
00:25:50,840 --> 00:25:54,040
about the change in tone from
leadership at at Gold Rd.

495
00:25:54,040 --> 00:25:56,480
There's, there's been a focus I
think in, in the past couple

496
00:25:56,480 --> 00:26:00,720
days on on value and we can chop
out a snippet from a recent

497
00:26:00,720 --> 00:26:05,160
article where you hear Gibbs
saying all of the correspondence

498
00:26:05,160 --> 00:26:07,480
in communication has been around
value.

499
00:26:07,480 --> 00:26:10,520
And that kind of ties in with
their counter proposal, doing it

500
00:26:10,520 --> 00:26:14,240
in line and saying, hey, we can
buy you for the same amount

501
00:26:14,240 --> 00:26:16,000
you've pitched.
That makes you really think

502
00:26:16,000 --> 00:26:18,840
about the value of what you've
kind of put forward to us, which

503
00:26:19,320 --> 00:26:22,000
I think is fascinating, right?
Big pivot, big pivot like so you

504
00:26:22,000 --> 00:26:26,680
read read gold roads initial
response to the to the bear hug

505
00:26:26,680 --> 00:26:31,120
from from gold fields.
And it was, I thought it was a

506
00:26:31,120 --> 00:26:35,200
poor letter if they were trying
to negotiate on value.

507
00:26:35,280 --> 00:26:37,840
It seemed like a, you know, a
reasonable letter to write if

508
00:26:37,840 --> 00:26:40,200
you're trying to say fuck off.
But there.

509
00:26:40,200 --> 00:26:42,040
Was seemed like a great one if
you want to burn the bridge.

510
00:26:42,360 --> 00:26:45,640
Yeah, exactly.
So it was like if you were

511
00:26:45,640 --> 00:26:48,080
trying to negotiate on value in
that letter, what you would say

512
00:26:48,080 --> 00:26:51,960
was, you know, we received a
lowball offer from Goldfields.

513
00:26:51,960 --> 00:26:56,600
It it, it included no, no, no
value attributable to our 100%

514
00:26:56,600 --> 00:26:58,640
owned assets.
You know, Gilmore or whatever

515
00:26:58,640 --> 00:27:01,440
they, they're called included no
value for our strategic equity

516
00:27:01,440 --> 00:27:04,760
positions in like Yandel and
whatever else they own, right?

517
00:27:04,760 --> 00:27:06,440
Things like that.
You would include and you would

518
00:27:06,440 --> 00:27:08,800
try and at least frame a
discussion of like why it's such

519
00:27:08,800 --> 00:27:10,400
a lowball.
And then that gives you some

520
00:27:10,400 --> 00:27:12,960
ground to stand on in
negotiating further.

521
00:27:12,960 --> 00:27:15,800
If you want to negotiate, you
kind of be sort of explicit

522
00:27:15,800 --> 00:27:18,920
about how much you've been
undervalued and why to some

523
00:27:18,920 --> 00:27:21,080
extent.
But, and, and we didn't see any

524
00:27:21,080 --> 00:27:22,800
of that.
And now the Wall Street Journal

525
00:27:22,800 --> 00:27:25,840
article, like there's, there's
talk of, of value.

526
00:27:25,840 --> 00:27:29,800
We're open to, we're open to,
to, to, to discussions at the

527
00:27:29,800 --> 00:27:31,960
right price, like those sorts of
like things there.

528
00:27:31,960 --> 00:27:35,120
And I just interpret that as
like go, go for the strategies

529
00:27:35,120 --> 00:27:37,720
worked.
Like you know, if, if you've, if

530
00:27:37,720 --> 00:27:40,120
you've changed the, the
messaging in a short period of

531
00:27:40,120 --> 00:27:42,240
time, maybe maybe shareholders
have picked up the phone and,

532
00:27:42,800 --> 00:27:44,800
and said, come on, that's it,
it's time to do the deal.

533
00:27:45,200 --> 00:27:47,040
Yeah, because that that's none
of that would.

534
00:27:47,040 --> 00:27:48,520
Come out public.
Yeah, that's it.

535
00:27:48,520 --> 00:27:51,360
None of it would have come out
public if it was negotiated in

536
00:27:51,360 --> 00:27:52,880
the 1st place.
Could have stayed by and closed

537
00:27:52,880 --> 00:27:54,480
doors for three months.
Ever.

538
00:27:55,040 --> 00:27:58,600
Yeah, yeah.
Yeah, yeah, maybe he's not.

539
00:27:58,600 --> 00:28:01,400
The and the likes got in, got in
the ear of Duncan and said hey,

540
00:28:01,400 --> 00:28:05,360
you should actually pick up the
phone and have a a productive

541
00:28:05,360 --> 00:28:07,240
discussion.
Big old Evie's been on the

542
00:28:07,240 --> 00:28:10,760
blower a bit this week,
actually.

543
00:28:11,720 --> 00:28:12,600
The other part.
Trav you.

544
00:28:12,800 --> 00:28:15,920
That, that, yeah, like so there
will be obviously existing

545
00:28:15,920 --> 00:28:19,120
shareholders, but then you get
your M&A ARB funds that get

546
00:28:19,120 --> 00:28:22,240
excited here as well.
And if, if they buy a meaningful

547
00:28:22,240 --> 00:28:26,120
enough stake in Gold Rd. knowing
that a deal is possible, well,

548
00:28:26,120 --> 00:28:28,840
all of a sudden you might have
five, 1015% of your your

549
00:28:28,840 --> 00:28:32,440
register in a short period of
time is now the M&A AAB funds

550
00:28:32,440 --> 00:28:34,960
who guess what, guess what they
do, they exert the pressure to

551
00:28:34,960 --> 00:28:37,360
say, all right, time to get this
deal done because that's my,

552
00:28:37,760 --> 00:28:40,960
that's my risk.
That's that's my AB, yeah. 100%

553
00:28:40,960 --> 00:28:43,400
because if you look where the
share price opened when it first

554
00:28:43,400 --> 00:28:46,440
got released and it came out in
the afternoon and then it

555
00:28:46,440 --> 00:28:49,360
started trading, I want to say
like 2 sixties, two 70s, and now

556
00:28:49,360 --> 00:28:51,720
we're talking about it touching
on three bucks.

557
00:28:52,080 --> 00:28:54,520
So the belief in the market that
a deal kind of gets done or

558
00:28:54,520 --> 00:28:57,440
another bid comes in or whatever
has clearly risen as well, which

559
00:28:57,440 --> 00:29:00,520
is pretty noticeable.
Yeah, I couldn't believe how far

560
00:29:00,520 --> 00:29:03,440
away it was on the first day.
Like it wasn't even in the

561
00:29:03,600 --> 00:29:04,680
ballpark.
It was like.

562
00:29:04,720 --> 00:29:08,440
Well, I think that's just speaks
speaks to like how outright

563
00:29:08,440 --> 00:29:10,640
their rejection was initially.
Yeah.

564
00:29:10,640 --> 00:29:13,840
And it's, it's, it's not,
there's no, it's no certainty

565
00:29:13,880 --> 00:29:15,480
here, right.
There's like a lot of, there's a

566
00:29:15,480 --> 00:29:17,600
lot to play out.
So yeah, yeah, the, the, the

567
00:29:17,600 --> 00:29:20,240
risk if you were playing the
ARB, there's a lot of risk of

568
00:29:20,240 --> 00:29:23,720
deal completion here.
But yeah, the, the more M&A are

569
00:29:23,720 --> 00:29:26,480
funds by interestingly enough,
the better your odds of closing

570
00:29:26,480 --> 00:29:28,880
the deal happen because you've
got collective pressure to

571
00:29:28,880 --> 00:29:31,480
apply.
Yeah, I do want to.

572
00:29:31,520 --> 00:29:32,680
So what?
What are the?

573
00:29:32,680 --> 00:29:37,160
Defence bankers playing at then.
So I'm going to, I'm going to

574
00:29:37,160 --> 00:29:39,960
kind of have a bit of a
hypothetical here, if you would,

575
00:29:40,040 --> 00:29:44,520
if you're being really cynical
and hypothesizing, what if, what

576
00:29:44,520 --> 00:29:48,160
if Gold Rd. you know, had bad
intentions and, and, and wanted

577
00:29:48,160 --> 00:29:52,280
to do something to, to stay it's
own company at the expense of

578
00:29:52,360 --> 00:29:54,720
maximizing shareholder value by
doing a deal.

579
00:29:54,840 --> 00:29:55,920
What could they do?
Right?

580
00:29:56,800 --> 00:30:00,200
And if you wanted to do that,
what you do is you'd buy

581
00:30:00,200 --> 00:30:02,680
something kind of crap and pay
too much for it.

582
00:30:03,000 --> 00:30:05,560
You'd enter the scheme
implementation deed, pay too

583
00:30:05,560 --> 00:30:10,800
much and and what you would do
is you as the acquirer structure

584
00:30:10,840 --> 00:30:13,840
that scheme implementation deed
such that there was no fiduciary

585
00:30:13,840 --> 00:30:16,120
out for you, the acquirer.
And then all of a sudden it's a

586
00:30:16,120 --> 00:30:18,560
poison pill, right?
You're not attractive to to gold

587
00:30:18,560 --> 00:30:20,200
fields anymore because you just
pay too much for something they

588
00:30:20,200 --> 00:30:22,320
didn't want.
And there's no way to interlock

589
00:30:22,320 --> 00:30:25,040
it because there's no fiduciary
out for for Gold Rd., the

590
00:30:25,040 --> 00:30:28,120
acquirer.
It's only if it gets voted down

591
00:30:28,120 --> 00:30:30,680
by the target.
Yeah, yeah, yeah.

592
00:30:30,680 --> 00:30:34,680
So it's a, it's a, it's a bit of
a sinister thought, but you can

593
00:30:34,680 --> 00:30:37,240
never rule these things out.
And in fact, JD, when you when

594
00:30:37,240 --> 00:30:41,080
you did your M and a disasters
kind of episode earlier this

595
00:30:41,080 --> 00:30:43,120
week, like there are a couple of
things in there that very well

596
00:30:43,120 --> 00:30:46,400
may have just been intentional
bad deals to be poison pills for

597
00:30:46,480 --> 00:30:48,440
for a similar kind of rationale.
So that I'm entertaining it.

598
00:30:48,440 --> 00:30:51,240
It's a possibility here, but I
don't I'd like to think that it

599
00:30:51,240 --> 00:30:55,160
wouldn't be a possibility.
I I will say though, if this

600
00:30:55,160 --> 00:30:59,640
unlikely but dark scenario does
play out, it'll obviously open

601
00:30:59,640 --> 00:31:02,280
up, you know the board to a lot
of criticism, not just because

602
00:31:02,280 --> 00:31:05,320
of the blatant opportunity cost
of a of a decent deal with

603
00:31:05,320 --> 00:31:08,400
Goldfields now, but also because
of hypocrisy.

604
00:31:08,400 --> 00:31:10,720
If it did happen.
Do you guys remember the very

605
00:31:10,720 --> 00:31:13,800
first time we got into the weeds
on fiduciary outs?

606
00:31:14,880 --> 00:31:17,120
I'll probably didn't remember
because I didn't understand it.

607
00:31:19,400 --> 00:31:22,040
So we all got up.
We exploded a fair bit in the

608
00:31:22,040 --> 00:31:24,160
The Battle for Leonora.
Definitely didn't understand.

609
00:31:25,160 --> 00:31:27,480
And when we when we started the
podcast, like the Battle for

610
00:31:27,480 --> 00:31:30,600
Leonora that we got tangled up
in, it was the asset deal.

611
00:31:30,720 --> 00:31:33,400
But let's not forget the very
first iteration of the deal with

612
00:31:33,400 --> 00:31:35,720
Genesis.
It was actually St.

613
00:31:35,720 --> 00:31:39,200
Barbara acquiring Genesis,
renaming to Hoover House and

614
00:31:39,200 --> 00:31:41,640
there was a spin out.
For nation medals.

615
00:31:41,640 --> 00:31:44,120
Phoenician medals was going to
be Atlantic and Sambarian and

616
00:31:44,120 --> 00:31:46,600
why I bring this up?
Saint Barbara's chair of the

617
00:31:46,600 --> 00:31:48,520
board at that time, Team
Netschha.

618
00:31:49,120 --> 00:31:51,120
Gold Roach chair right now, Team
Netschha.

619
00:31:51,640 --> 00:31:54,960
And in version 1 where St.
Barbara was the acquirer of

620
00:31:54,960 --> 00:31:59,600
Genesis, guess what was in the
scheme implementation deed a

621
00:31:59,960 --> 00:32:04,040
fiduciary out for Saint Barbara.
So and these these are not like

622
00:32:04,080 --> 00:32:07,280
ordinary to slip in as the
acquirer like these fiduciary

623
00:32:07,280 --> 00:32:10,320
outs for the acquirer are are
not customary.

624
00:32:10,320 --> 00:32:14,160
So this was probably insisted
upon by by say Barbara by it,

625
00:32:14,160 --> 00:32:16,720
but maybe by Tim is kind of what
I'm saying, but I don't know.

626
00:32:17,360 --> 00:32:21,560
But yeah, so it's like, if you
why would you, why would you be

627
00:32:21,560 --> 00:32:23,680
part of a team that insisted on
a fiduciary out for the acquirer

628
00:32:23,680 --> 00:32:26,240
in that situation then?
And then and then this is in a

629
00:32:26,440 --> 00:32:29,960
in a sinister world, if, if gold
bro did something bad like this,

630
00:32:30,240 --> 00:32:32,840
not not put a fiduciary out when
you're when you're buying, when

631
00:32:32,840 --> 00:32:34,720
you're buying something, stay
alive here.

632
00:32:34,800 --> 00:32:37,680
So it's just I'm getting, I'm
getting like 5 steps ahead and I

633
00:32:37,680 --> 00:32:40,240
don't want to don't want to, you
know, put anyone under the under

634
00:32:40,240 --> 00:32:41,960
the microscope when they
literally have done no actions

635
00:32:41,960 --> 00:32:44,760
to to warrant it.
But if in a really dark

636
00:32:44,760 --> 00:32:47,680
hypothetical world where where
gold Rd. you know went the boys

637
00:32:47,680 --> 00:32:50,360
and people were out, they bet
there better be a fiduciary out

638
00:32:50,360 --> 00:32:51,960
in that scheme.
Implementation did, otherwise

639
00:32:51,960 --> 00:32:53,760
it'd be be inconsistent.
Yeah.

640
00:32:54,200 --> 00:32:56,560
Is there.
So are you thinking that the the

641
00:32:56,560 --> 00:33:00,760
tone is when you said the latest
article talking about value, do

642
00:33:00,760 --> 00:33:03,120
you think we're sort of leaning
towards possibly a bit of

643
00:33:03,600 --> 00:33:05,800
shareholder pressure towards
Gold Rd.

644
00:33:05,800 --> 00:33:10,200
Engaging and getting a deal done
for cash.

645
00:33:10,800 --> 00:33:14,120
Just opening negotiations again,
I think is the the kind of first

646
00:33:14,120 --> 00:33:17,520
step and in any case, I think
that's that's better for the

647
00:33:17,520 --> 00:33:20,880
relationship given that they are
JV partners overall so.

648
00:33:21,160 --> 00:33:23,200
Can they?
That's the they can't put a

649
00:33:23,200 --> 00:33:27,160
lower offer in, But yeah, they
can only because it's like, hey.

650
00:33:27,240 --> 00:33:28,560
You can.
I don't think it'd be received

651
00:33:28,560 --> 00:33:31,720
too well.
Well, it's like, hey, yeah,

652
00:33:31,840 --> 00:33:35,160
thanks for the comments.
In the paper was 3 bucks, 2 now

653
00:33:35,160 --> 00:33:37,120
Yeah.
Yeah, well, it's kind of, it's

654
00:33:37,120 --> 00:33:39,240
kind of interesting, right,
Because it's like if you're gold

655
00:33:39,600 --> 00:33:41,640
fields, you don't actually need
to do DD.

656
00:33:41,720 --> 00:33:43,720
This is your asset.
Like, yeah, what Like it's not

657
00:33:43,720 --> 00:33:46,040
like you're trying so that
they're comfortable with the

658
00:33:46,040 --> 00:33:47,960
asset.
It's it's, you know, all they

659
00:33:47,960 --> 00:33:50,040
need is a bit of a bit of
receptiveness.

660
00:33:50,040 --> 00:33:51,640
There's no the conditionality
here.

661
00:33:51,640 --> 00:33:54,160
It's like it's they've got net
cash, they can pay for it.

662
00:33:54,480 --> 00:33:56,560
It's not going to be really
conditional on technical DD

663
00:33:56,560 --> 00:33:58,640
because they know the asset
better than anyone.

664
00:33:59,480 --> 00:34:03,480
So it's, it's, I think odds are
here that a, that a, that a deal

665
00:34:03,560 --> 00:34:05,560
gets done.
Yeah, yeah.

666
00:34:05,560 --> 00:34:08,040
And you could argue on the DD
front that Goldfields might know

667
00:34:08,040 --> 00:34:10,760
the asset a bit better than Gold
Rd.

668
00:34:10,800 --> 00:34:12,600
Oh gold gold.
Is it just his cover?

669
00:34:12,600 --> 00:34:13,520
So I'll.
Give him some credit.

670
00:34:15,080 --> 00:34:18,679
You see the detail with
goldfields giving them after the

671
00:34:18,679 --> 00:34:22,280
after the the bid, the draft
version of the underground

672
00:34:22,280 --> 00:34:24,600
study.
Oh, no, I didn't say that,

673
00:34:24,600 --> 00:34:25,880
actually.
Yeah, that's interesting.

674
00:34:26,000 --> 00:34:26,639
Yeah.
Juicy.

675
00:34:26,639 --> 00:34:27,840
Little detail, yeah.
Yeah, yeah.

676
00:34:28,639 --> 00:34:31,199
I don't but.
Plays into the opportunistic

677
00:34:31,199 --> 00:34:33,560
framing that that Gold Rd. put
forward.

678
00:34:34,040 --> 00:34:38,120
But how many around that study,
like how many times have you

679
00:34:38,120 --> 00:34:42,440
seen like a, an underground
study come out for a big

680
00:34:42,440 --> 00:34:46,719
existing operation and it'd be
like, holy shit, the value it's

681
00:34:46,840 --> 00:34:51,639
flying now.
Hardly ever like not like when

682
00:34:51,639 --> 00:34:54,159
WAFF release a underground
study, it's not like it

683
00:34:54,360 --> 00:34:57,160
materially moves the price and
value.

684
00:34:57,160 --> 00:35:00,720
I just, I just don't think it's
gonna be that big of a thing

685
00:35:00,720 --> 00:35:03,440
about, Oh no, once that comes
out, it's going to be a $4.00

686
00:35:03,440 --> 00:35:05,200
stock, not $3.
It doesn't matter the share

687
00:35:05,200 --> 00:35:08,120
price, you're 100% right, but it
does matter in the machinations

688
00:35:08,120 --> 00:35:11,800
of the 11th hour deal value
negotiations because you're,

689
00:35:11,840 --> 00:35:14,120
you're arguing with them and,
and you bring out your

690
00:35:14,120 --> 00:35:16,120
spreadsheets and you're like,
look, look at the MPV here.

691
00:35:16,120 --> 00:35:18,400
And then all of a sudden if you
can show a bigger MPV then it

692
00:35:18,400 --> 00:35:21,480
gives you and like it.
It's funny, right?

693
00:35:21,520 --> 00:35:23,840
I, I think this is like out in,
out in the abyss.

694
00:35:23,840 --> 00:35:27,280
You can you can find this out,
but like a deal that is clearly

695
00:35:27,440 --> 00:35:30,280
been a disaster was Igos
acquisition of of western areas

696
00:35:30,680 --> 00:35:34,040
at the at the 11th hour.
It was actually after a deal was

697
00:35:34,040 --> 00:35:37,800
agreed, there was another uplift
provided to kind of get the deal

698
00:35:37,800 --> 00:35:40,200
done because there was some hold
out shareholders and there was

699
00:35:40,280 --> 00:35:43,600
some argy bargy on the value of
Mount good which was sort of

700
00:35:43,600 --> 00:35:46,000
like a not even a mine.
This is just like you're trying

701
00:35:46,000 --> 00:35:50,480
to value this like, you know,
potential call option if nickel

702
00:35:50,480 --> 00:35:53,440
price went to the moon and you
know, actually added like a, you

703
00:35:53,440 --> 00:35:56,400
know, a pretty meaningful value
uplift based off your argument

704
00:35:56,400 --> 00:35:59,400
that that this thing has some
value, which is clearly not

705
00:35:59,400 --> 00:36:01,640
going to be mine for like 50
years.

706
00:36:02,080 --> 00:36:05,080
Yeah, with my nickel, nickel's
gone.

707
00:36:05,080 --> 00:36:06,800
It's gone from mount good to
mount shit.

708
00:36:08,760 --> 00:36:14,240
Oh, Speaking of, Speaking of IG
Howard, I'd like Cosmos is just

709
00:36:14,240 --> 00:36:18,520
getting flooded again.
Like just, I don't know if

710
00:36:18,520 --> 00:36:22,720
that's yeah, just after all that
decline rehab and everything to

711
00:36:22,720 --> 00:36:25,120
get back down there and re
establish it in the shaft and

712
00:36:25,120 --> 00:36:27,600
infrastructure and everything.
It's just in the water up there

713
00:36:27,600 --> 00:36:29,480
is apparently a bit.
Here you go.

714
00:36:29,680 --> 00:36:32,000
So I was just going to corrode
it all again.

715
00:36:32,000 --> 00:36:36,640
And like, all that effort and
sounds like it's just written

716
00:36:36,640 --> 00:36:39,920
off, properly written off.
Like if you're going to let the

717
00:36:39,920 --> 00:36:43,560
water back in, yeah.
Probably someone they can call

718
00:36:43,560 --> 00:36:46,160
if they had the cash.
Well, Jada, you're a bloody Are

719
00:36:46,160 --> 00:36:49,800
you a Vosan shareholder still?
I actually am, yeah.

720
00:36:49,840 --> 00:36:54,520
Yeah, Ding, Ding, Ding.
But talking about like a, you as

721
00:36:54,520 --> 00:36:58,680
a shareholder probably should be
interested in M&A opportunities

722
00:36:58,680 --> 00:37:00,400
like this.
And this wouldn't be a poison

723
00:37:00,400 --> 00:37:06,840
pill situation if Vosan started
getting attacked by someone

724
00:37:06,840 --> 00:37:09,320
wanting to buy them.
What if they buy WA water

725
00:37:09,320 --> 00:37:12,720
boards?
That's like that's that's not

726
00:37:12,720 --> 00:37:15,160
like you're just you.
If you're looking to buy someone

727
00:37:15,160 --> 00:37:18,480
crap, it's not them because they
are the bloody gurus in

728
00:37:18,480 --> 00:37:21,520
Australia for anything related
to water drilling.

729
00:37:21,520 --> 00:37:24,280
That'd be a probably a good.
I'll read it from here.

730
00:37:24,280 --> 00:37:27,120
Vice Arm provides end to end
water solutions to miners and

731
00:37:27,120 --> 00:37:30,280
infrastructure players.
Do you have a water board

732
00:37:30,280 --> 00:37:32,840
drilling expert like James
Harrington in your team?

733
00:37:33,760 --> 00:37:37,120
I don't know, perfect.
You can buy him.

734
00:37:37,320 --> 00:37:40,120
You can buy him.
He's not that.

735
00:37:40,120 --> 00:37:41,040
Good.
It's not the same.

736
00:37:41,040 --> 00:37:42,760
He's not the same.
He's not the same he.

737
00:37:43,120 --> 00:37:47,760
Is he is for hire like if you
need someone to do expert or

738
00:37:47,760 --> 00:37:49,000
boring for?
You mate.

739
00:37:49,000 --> 00:37:51,720
Voice art, mate.
Tell you what Gerald, I want to

740
00:37:51,720 --> 00:37:54,800
see Gerald James on The Voice
Arm website.

741
00:37:55,600 --> 00:37:58,640
Listen, he.
Key management personnel.

742
00:37:59,440 --> 00:38:02,000
He shouldn't be surprised with
the job he does that the phone's

743
00:38:02,000 --> 00:38:03,560
been buzzing off the.
Hook.

744
00:38:04,640 --> 00:38:08,080
You just deliver those sorts of
results for companies all across

745
00:38:08,080 --> 00:38:10,080
WA and what do you reckon,
Maddie?

746
00:38:10,080 --> 00:38:11,760
I reckon the M&A offers just
flying oh.

747
00:38:12,120 --> 00:38:15,360
Mate if you converted James
Harrington into a fly rat it'd

748
00:38:15,360 --> 00:38:17,560
be 6000 litres a second.
He's that good.

749
00:38:17,880 --> 00:38:21,400
He's unreal though.
Whoever's on defence for Gold

750
00:38:21,400 --> 00:38:24,200
Rd., if they want another client
they should get in touch with

751
00:38:24,200 --> 00:38:27,760
James I reckon Gerard.
James loves M&A, right.

752
00:38:29,120 --> 00:38:32,440
What about what do we got?
We're going to go gold sector M

753
00:38:32,440 --> 00:38:33,080
and A, I think.
Yeah.

754
00:38:33,080 --> 00:38:36,280
I thought you should just or do
you want to do that after thing

755
00:38:36,440 --> 00:38:39,560
just because that might tie into
gold sector M and A?

756
00:38:40,160 --> 00:38:41,440
Let's do it.
Let's talk Bellevue.

757
00:38:41,440 --> 00:38:47,560
Yeah, so this is oh mate, in the
lead up to this and even after

758
00:38:47,680 --> 00:38:54,520
all this, it is still there's
longs and like not longs like,

759
00:38:54,520 --> 00:38:57,280
but in terms of thinking it's
like on up, they're prime for a

760
00:38:57,280 --> 00:38:59,000
takeover target.
Now they're going to be getting

761
00:38:59,000 --> 00:39:04,800
looked at like they're it's
still such a a divide, yeah,

762
00:39:04,800 --> 00:39:07,880
between what's happening, but
far out.

763
00:39:07,880 --> 00:39:10,120
So I'll, I'll go through, go
through what's happened.

764
00:39:10,120 --> 00:39:12,480
What we know buddy, what we can
infer.

765
00:39:12,480 --> 00:39:15,360
As I said at the start, Bellevue
went into trade and hold on the

766
00:39:15,720 --> 00:39:22,280
26th yesterday, just before the
end of trade, and it was, oh,

767
00:39:22,280 --> 00:39:23,880
the bloody wording.
I tell you what.

768
00:39:24,160 --> 00:39:26,760
Process of review and
verification of gold production

769
00:39:26,760 --> 00:39:30,680
outcomes which may result in
downward adjustment to its

770
00:39:30,680 --> 00:39:33,600
production guidance process and
review and verification.

771
00:39:33,600 --> 00:39:35,560
I don't know if it's
verification, talking about

772
00:39:35,560 --> 00:39:39,320
what's been produced, if that's
needs verifying, or I don't

773
00:39:39,360 --> 00:39:41,480
know.
Just frigging the.

774
00:39:42,280 --> 00:39:45,360
The wording was was curious.
Very curious like.

775
00:39:45,360 --> 00:39:47,000
Ambiguous.
Yeah.

776
00:39:47,760 --> 00:39:51,160
And it just that it intends to
make an announcement regarding

777
00:39:51,160 --> 00:39:55,440
production guidance for FY25.
So it doesn't alluded to any

778
00:39:55,440 --> 00:40:00,040
other future growth guidances or
predictions, but whether that

779
00:40:00,040 --> 00:40:04,200
comes or not.
So they and this was just after

780
00:40:04,920 --> 00:40:07,800
when we covered at the start of
the week when they cancelled the

781
00:40:08,320 --> 00:40:12,280
UBS Roadshow MD had to fly to
sight the stock come off from

782
00:40:12,760 --> 00:40:15,480
what was it about The thing is
about $1.30 down to the dollar.

783
00:40:16,000 --> 00:40:22,920
Dollar teens and then then this
comes out and then also due to

784
00:40:22,920 --> 00:40:27,600
the linkage develop yesterday,
as soon as that trading halt

785
00:40:27,600 --> 00:40:31,120
come out developed at a big
dollar in, you know, up near the

786
00:40:31,480 --> 00:40:34,840
share price had started lifting
again and they're going from,

787
00:40:34,840 --> 00:40:38,960
you know, 33 teens back down to
the two 80s on the back of that.

788
00:40:38,960 --> 00:40:42,400
So I'll show you the you can see
the graph here.

789
00:40:42,400 --> 00:40:45,360
It was just boom that about just
before 3:00.

790
00:40:45,680 --> 00:40:50,080
So and and look, the friggin
rumour mill was flying around

791
00:40:50,240 --> 00:40:52,880
yesterday regarding Bellevue and
develop.

792
00:40:53,480 --> 00:40:58,080
So, but I'm not not going to
share rumours because of who

793
00:40:58,120 --> 00:41:03,640
freaking knows, because but the
develop did come out with a

794
00:41:03,640 --> 00:41:07,200
statement today.
And you'd assume on the back of

795
00:41:07,200 --> 00:41:09,760
like what happened to their
share price due to the them

796
00:41:09,760 --> 00:41:13,360
having the Bellevue contract,
which is a very and I suppose

797
00:41:13,360 --> 00:41:17,880
everyone's like just the the
magnitude of it in terms of yes,

798
00:41:17,880 --> 00:41:21,400
it's develops only source of
revenue at the moment, like the

799
00:41:21,400 --> 00:41:25,800
mining services, but they're
just anything around that

800
00:41:25,800 --> 00:41:27,560
contract.
Like there's six jumbos there

801
00:41:27,560 --> 00:41:30,560
like a lot of gear on lines for
and everything.

802
00:41:30,560 --> 00:41:33,680
So it's obviously a a risk
anything with that contract.

803
00:41:33,680 --> 00:41:38,840
But they've come out and
essentially said there's well,

804
00:41:38,840 --> 00:41:41,600
the summary is there.
They've got the contract until

805
00:41:42,280 --> 00:41:45,240
end of calendar year 25.
They've got the option to extend

806
00:41:45,240 --> 00:41:48,360
it for a further 12 months at
their sole election.

807
00:41:48,640 --> 00:41:50,000
Bellevue.
Bellevue has the option.

808
00:41:50,800 --> 00:41:52,040
Bellevue Gold can extend the
contract.

809
00:41:52,040 --> 00:41:52,840
Yeah, yeah.
Sorry.

810
00:41:52,840 --> 00:41:55,680
Yeah, yeah.
And then it says the

811
00:41:55,680 --> 00:41:58,360
relationship between developing
Bellevue is very strong in all

812
00:41:58,360 --> 00:42:02,320
areas.
And they've said that mined

813
00:42:02,320 --> 00:42:07,000
physicals for the March quarter
are forecasted to be 20% above

814
00:42:07,000 --> 00:42:10,400
the December quarters results.
So we're assuming that means

815
00:42:10,400 --> 00:42:14,280
development and production and
Bellevue Gold is up to date with

816
00:42:14,280 --> 00:42:17,200
all payment terms associated
with the mining contracts.

817
00:42:17,200 --> 00:42:19,280
So that was putting a pin in the
rumour mill.

818
00:42:19,360 --> 00:42:21,680
Pretty much every rumour mill is
about those things.

819
00:42:22,600 --> 00:42:27,200
So yeah, so I'll go go through
like I'll fucking tell you what,

820
00:42:27,200 --> 00:42:31,400
I've just beat me head against
this to be honest, because when

821
00:42:31,400 --> 00:42:34,840
you look at the yes, there was
that reserve downgrade

822
00:42:34,840 --> 00:42:37,840
previously.
Like it was the reserve was 6.1

823
00:42:37,840 --> 00:42:42,600
grams a ton for the underground.
Like there's a very small open

824
00:42:42,600 --> 00:42:48,880
pit portion, but 6.1 grams then
got downgraded to 5g per ton

825
00:42:48,880 --> 00:42:51,560
when they sort of changed the
numbers a bit.

826
00:42:51,560 --> 00:42:54,920
So I thought think of 5g and
then and when I say reserve,

827
00:42:54,960 --> 00:42:58,520
it's don't just look at the
stopping grade.

828
00:42:58,520 --> 00:43:01,080
Like you know how they say like
you when you mine more

829
00:43:01,080 --> 00:43:07,720
development or you obviously
down drop the mind grade, but

830
00:43:07,720 --> 00:43:11,920
the the reserve is calculated
taking into account all the

831
00:43:11,920 --> 00:43:15,240
development ore as well.
So it's not just a dilution on

832
00:43:15,240 --> 00:43:17,560
the ore body and everything.
It takes into account the fact

833
00:43:17,560 --> 00:43:21,560
that all these drives go in and
go on the wrong pad and the

834
00:43:21,560 --> 00:43:24,080
start comes then.
So that's all taken into account

835
00:43:24,080 --> 00:43:26,680
in the reserve grade.
Yes, If you don't have the

836
00:43:26,680 --> 00:43:31,400
correct ratio of development and
production going, you might be

837
00:43:31,400 --> 00:43:35,080
skewed on in quarters because
that means your grade is

838
00:43:35,920 --> 00:43:37,640
technically lower than the
reserve grade because you're

839
00:43:37,640 --> 00:43:40,360
taking more development or ahead
of time with the staffing.

840
00:43:40,360 --> 00:43:43,680
But it should, it should balance
out that you should be hitting

841
00:43:43,680 --> 00:43:45,880
your close to your reserve
grade.

842
00:43:46,360 --> 00:43:51,320
No, but it depends on depends on
where it's distributed as well.

843
00:43:51,320 --> 00:43:54,080
Like it could be like you could
have a very high reserve grade,

844
00:43:54,080 --> 00:43:57,200
but it's concentrated in an area
that you're not mining for two

845
00:43:57,200 --> 00:44:00,000
years.
But it's a, it's sort of the the

846
00:44:00,000 --> 00:44:03,120
baseline that probably
everyone's looking at to see if

847
00:44:03,120 --> 00:44:05,760
the mine is performing based on
the reserve grade.

848
00:44:05,960 --> 00:44:08,080
So are you looking at, are you
looking at the reserve here?

849
00:44:08,080 --> 00:44:12,400
Because because Bellevue's
announcement is talking about

850
00:44:12,400 --> 00:44:16,040
verification of production and
then and then develop says that

851
00:44:16,040 --> 00:44:19,640
they they hit they hit kind of
20% more target.

852
00:44:19,720 --> 00:44:22,480
So you're thinking, well, if if
it's not, if it's not like

853
00:44:22,560 --> 00:44:26,000
development meters and it's a a
downgrade than it is a could be

854
00:44:26,000 --> 00:44:29,240
a reserve issue.
Yeah, OK, well and it's so

855
00:44:29,240 --> 00:44:30,960
they've said they've said
they've got the physicals

856
00:44:30,960 --> 00:44:32,000
they're 20% above.
OK.

857
00:44:32,000 --> 00:44:37,080
So that means I can predict that
production tons and development

858
00:44:37,560 --> 00:44:42,320
tons are above what they got
last quarters, which means they

859
00:44:42,320 --> 00:44:47,840
should be getting enough dirt on
the ROM pad for them to process.

860
00:44:48,240 --> 00:44:51,880
And but now they're coming out
with a production downgrade,

861
00:44:51,880 --> 00:44:54,760
which is answers.
So the only thing that can be

862
00:44:54,760 --> 00:44:58,720
lower than anticipated is the
grade and you, you just look

863
00:44:59,640 --> 00:45:04,800
March and June 2024 like that.
Mine grade was 6g and 7 grams.

864
00:45:04,800 --> 00:45:06,640
So that was that was above
reserve grade.

865
00:45:07,680 --> 00:45:11,880
September 4 1/2 went below
December then went down to 3.7.

866
00:45:12,240 --> 00:45:15,960
They did say that they're going
through outer edges of the ore

867
00:45:15,960 --> 00:45:20,480
body, yada yada.
But you can just predict, OK, it

868
00:45:20,480 --> 00:45:24,280
appears the, you predict the
grade isn't going to be a

869
00:45:24,280 --> 00:45:27,080
significant improvement on the
December quarter if they're

870
00:45:27,720 --> 00:45:31,560
whether this is just related to
Q4, not Q3.

871
00:45:31,560 --> 00:45:34,120
But they, they did say it was
back weighted.

872
00:45:34,120 --> 00:45:38,800
But it, it just appears at the
moment that the reserve grade

873
00:45:38,800 --> 00:45:46,040
isn't coming to the forefront.
So, and, and you can't say that

874
00:45:46,760 --> 00:45:48,880
there's 2 two ways that that
could happen.

875
00:45:49,040 --> 00:45:54,360
Either the, the geological
modelling is incorrect or what's

876
00:45:54,360 --> 00:45:58,720
coming out is not correct.
And you just look at how much

877
00:45:58,720 --> 00:46:01,640
infill drilling they've done,
like, and the hits of it, like

878
00:46:01,640 --> 00:46:03,560
they're just, you know, I'll
bring these up just like

879
00:46:03,560 --> 00:46:08,800
sensational, it's always been a
stand out of like quality of

880
00:46:08,800 --> 00:46:10,600
intercepts.
Like just, you're looking at

881
00:46:10,600 --> 00:46:15,320
like 1.6 meters at 244g per ton,
like 6.2 or 20.8.

882
00:46:15,320 --> 00:46:19,000
Like, yeah, the there's a lot of
infill drill and the gold is

883
00:46:19,000 --> 00:46:24,440
there, but if you look put the
underground mining hat back on

884
00:46:24,520 --> 00:46:27,640
and of of running out of years,
I can do this because I'm

885
00:46:27,640 --> 00:46:31,280
starting to forget all of it.
But if you just look at the

886
00:46:31,280 --> 00:46:37,560
photos they put up of this, that
appears to be the ore body in

887
00:46:37,560 --> 00:46:41,920
between the pink lines and it
appears to be vertical, but it's

888
00:46:42,320 --> 00:46:46,320
on the right hand side of that
development drive.

889
00:46:46,680 --> 00:46:52,040
So to effectively mine that with
the and stay within the dilution

890
00:46:52,040 --> 00:46:56,240
parameters and the recovery of
that gold, that a vertical or

891
00:46:56,840 --> 00:46:59,480
vine needs to be in the dead
centre of the drive.

892
00:47:00,280 --> 00:47:02,320
And, and look at chops and
changes all the time.

893
00:47:02,320 --> 00:47:04,440
You can't get it perfect all the
time.

894
00:47:06,160 --> 00:47:09,880
And you do your best to then
turn the drive back onto the

895
00:47:09,920 --> 00:47:11,840
ore.
But then you look at look at the

896
00:47:11,840 --> 00:47:15,080
next one, same.
It looks pretty, pretty

897
00:47:15,080 --> 00:47:16,600
vertical.
Same thing.

898
00:47:16,600 --> 00:47:18,680
It's sort of it's in the right
hand side of the drive.

899
00:47:18,680 --> 00:47:23,560
So to actually mine that, like
you, the only way to mine that,

900
00:47:23,560 --> 00:47:26,080
like the first step you do is
stop.

901
00:47:26,520 --> 00:47:29,600
You have to strip out the right
hand wall, get the oil back into

902
00:47:29,600 --> 00:47:33,240
the middle and then continue on.
Then you've got the room for the

903
00:47:33,600 --> 00:47:35,640
long oil drill to fit the boom
in.

904
00:47:36,120 --> 00:47:39,280
Drill a parallel hold of that
because at the moment you can't,

905
00:47:39,280 --> 00:47:41,840
you can't drill a parallel hole
to that all body on the right

906
00:47:41,840 --> 00:47:44,480
hand wall because you can't
drill a vertical hole up the

907
00:47:44,480 --> 00:47:46,400
side of a wall.
It just cannot happen.

908
00:47:47,360 --> 00:47:51,440
And the way to recover it is
like, yeah, there's a potential

909
00:47:51,840 --> 00:47:55,080
you sort of fan it out to
compensate for it.

910
00:47:55,080 --> 00:47:57,960
But there's a risk that you
leave some gold in the ground

911
00:47:58,360 --> 00:48:01,960
and the fan out will bring in
more dilution just because you

912
00:48:03,520 --> 00:48:07,360
and you leave a lip on the on
the on the where you got all the

913
00:48:07,360 --> 00:48:09,920
waste on the left.
Like if you sort of mine that

914
00:48:09,920 --> 00:48:13,560
you leave a lip there and then
that just has it sometimes

915
00:48:13,560 --> 00:48:17,760
tendency to fall in and create
more dilution and just sort of

916
00:48:17,760 --> 00:48:20,560
mines to the shoulders, usually
at the bottom.

917
00:48:20,560 --> 00:48:23,280
But this is hard ground.
So maybe, maybe not.

918
00:48:23,680 --> 00:48:27,320
But I guess the the interesting
thing I found on that is if you

919
00:48:27,320 --> 00:48:34,360
see that white cross on the
middle of this Bellevue 1000,

920
00:48:34,880 --> 00:48:39,360
there's a white cross that says
1.5 down 2.5, right?

921
00:48:40,000 --> 00:48:45,200
That is a laser cross.
So that means that that I'm

922
00:48:46,840 --> 00:48:51,560
assuming that that means that
drive is on laser survey

923
00:48:51,560 --> 00:48:53,560
control.
So you put the laser in you can

924
00:48:53,560 --> 00:48:58,280
see it says D 15.5 S.
The laser is 15.5 to the face

925
00:48:58,280 --> 00:49:02,160
and you shut you get says based
on where you are and where the

926
00:49:02,160 --> 00:49:04,520
next cuts going.
This is the direction you got.

927
00:49:04,960 --> 00:49:07,880
But this isn't an all drive.
I've never worked in a narrow

928
00:49:07,880 --> 00:49:10,920
van gold mine that has all
drives on survey control.

929
00:49:11,120 --> 00:49:15,920
It's always the process is yeah,
mesh the heading you scale the

930
00:49:15,920 --> 00:49:17,760
face, bogger comes in cleans it
up.

931
00:49:17,760 --> 00:49:22,520
J OS go down there.
They map the face and say give

932
00:49:22,520 --> 00:49:27,600
you a skunk line, like say
right, 1m right or straight half

933
00:49:27,600 --> 00:49:29,960
a meter right, yada, yada.
And just to know that you're

934
00:49:29,960 --> 00:49:34,360
staying on the ore body, it
just, it looks like they're on

935
00:49:34,400 --> 00:49:38,320
survey control and you're
following the laser, but you're

936
00:49:38,320 --> 00:49:40,440
not.
The ore can like you can have

937
00:49:40,440 --> 00:49:43,520
minor faults that shifted a
meter within a cut.

938
00:49:43,920 --> 00:49:46,760
And if you keep following that
survey line, the ore is just not

939
00:49:46,760 --> 00:49:48,360
in the middle.
And then there's a risk that

940
00:49:48,360 --> 00:49:51,000
when you mine it and you're not
stripping out to get it back in

941
00:49:51,000 --> 00:49:55,440
the middle, there could be gold
being left there And you that,

942
00:49:55,440 --> 00:49:58,120
that, that's the only thing I
can think of of why this grade

943
00:49:58,120 --> 00:50:02,200
isn't performing because
everyone's, oh, the grade isn't

944
00:50:02,200 --> 00:50:03,520
there.
And I'm like, well, based on the

945
00:50:03,520 --> 00:50:07,320
drilling like, and the sign off
and the GI modelling like the,

946
00:50:08,520 --> 00:50:11,160
you assume the gold's there.
Just think there's a risk that

947
00:50:11,160 --> 00:50:13,040
it's not being mined.
Right.

948
00:50:13,240 --> 00:50:17,080
That'd be a better, that'd be a
better downgrade if it was kind

949
00:50:17,080 --> 00:50:18,000
of reserve issue.
You know what I mean?

950
00:50:18,000 --> 00:50:20,720
That's like that's like a short
term issue rather than a long

951
00:50:20,720 --> 00:50:23,080
term issue, right?
Yeah, I don't think it's Yeah,

952
00:50:23,080 --> 00:50:27,200
yeah, it's like that's I'm happy
to be corrected.

953
00:50:27,200 --> 00:50:31,040
But yeah, why would why would a,
why would a mine choose the

954
00:50:31,040 --> 00:50:33,880
survey control instead of the
the Geo process?

955
00:50:33,880 --> 00:50:34,720
Faster.
Faster.

956
00:50:35,280 --> 00:50:35,880
OK.
Yeah.

957
00:50:35,920 --> 00:50:39,240
So it could just be, yeah.
Yeah so the, the, the issue with

958
00:50:39,240 --> 00:50:43,080
having geological control is
like cycling, especially when

959
00:50:43,080 --> 00:50:47,120
you've got 6 jumbos you got if
you've got multiple headings on

960
00:50:47,120 --> 00:50:51,400
Geo control, you've got only a
fixed amount of geologists going

961
00:50:51,400 --> 00:50:54,080
underground and there could be
two headings ready right at the

962
00:50:54,080 --> 00:50:58,040
same time and two jumbos ready
to go into them individually.

963
00:50:58,040 --> 00:51:02,160
But the GI can only go to 1.
So they've got to go and map it

964
00:51:02,160 --> 00:51:07,080
could take, you know, depends
1020 minutes could be more.

965
00:51:07,080 --> 00:51:10,240
They've got to wash it down,
paint it up, get the samples,

966
00:51:10,520 --> 00:51:13,280
then they've got to pack up,
drive to the next one and

967
00:51:13,920 --> 00:51:16,160
potentially one Jumbo has to
wait.

968
00:51:16,480 --> 00:51:21,000
And when you're development
constrained, like it appears, as

969
00:51:21,000 --> 00:51:23,920
I said, you've got 6 jumbos that
are mine, that's 1,000,000 tonne

970
00:51:23,920 --> 00:51:26,400
more and that's a lot of
development capacity.

971
00:51:26,400 --> 00:51:30,240
So it's a development
constrained mine putting it on

972
00:51:30,240 --> 00:51:34,720
lasers, just like Bobby goes in,
cleans it up as soon as he walks

973
00:51:34,720 --> 00:51:38,000
out, Chucky laser in markup and
you're into it.

974
00:51:38,440 --> 00:51:40,160
So there's no, there's no hold
UPS.

975
00:51:40,160 --> 00:51:44,680
It's best for development.
But yeah, these are the I'll

976
00:51:44,680 --> 00:51:48,640
show you this picture like the
next one, like you can see arm

977
00:51:48,640 --> 00:51:51,840
and 1176.
So it's lying over and it's in

978
00:51:51,840 --> 00:51:53,400
the shoulder.
That's exactly where it should

979
00:51:53,400 --> 00:51:56,680
be because that's how you get
the angle to drill that.

980
00:51:57,560 --> 00:51:59,400
That's the that's where it
should be.

981
00:51:59,400 --> 00:52:02,440
Same as this next one here.
You can see the survey dot that

982
00:52:02,440 --> 00:52:06,640
that one's the real thick Dakin
one that's lying over and it

983
00:52:06,640 --> 00:52:08,720
goes into the shoulder.
But yeah, when it's vertical, it

984
00:52:08,720 --> 00:52:11,200
needs to be in the middle.
So just gone off the photos they

985
00:52:11,200 --> 00:52:14,520
put up.
That's my yeah.

986
00:52:14,520 --> 00:52:15,880
Excellent insight, Maddie.
That's.

987
00:52:16,040 --> 00:52:18,000
That's super interesting.
That's a theory, whether it's

988
00:52:18,040 --> 00:52:19,600
bloody accurate or not true or
not.

989
00:52:19,600 --> 00:52:21,840
But yeah, just going off what
I've seen, yeah.

990
00:52:22,080 --> 00:52:24,000
Super interesting.
I think that's a, that's an

991
00:52:24,000 --> 00:52:27,440
awesome sort of segue to finish
up on, on valuations across and

992
00:52:27,440 --> 00:52:31,560
combining what we've spoken
about today, because on that

993
00:52:31,560 --> 00:52:36,200
one, there's, you know, there's
not too many gold miners that

994
00:52:36,200 --> 00:52:39,640
have had the, the last year
share price wise that Bellevue

995
00:52:39,640 --> 00:52:42,600
have had, right.
So that leaves them in a

996
00:52:42,600 --> 00:52:44,600
situation after we see this news
come out.

997
00:52:44,600 --> 00:52:47,520
And if it is what you've said,
Maddie, it does to me appear

998
00:52:47,520 --> 00:52:52,720
like a fixable thing whether
whether people have different

999
00:52:52,720 --> 00:52:54,200
views on, on who kind of fixes
it.

1000
00:52:54,200 --> 00:52:56,240
I'm sure they kind of will out
there in the market.

1001
00:52:56,240 --> 00:52:59,000
I'll I'll caveat with like that
this could be one.

1002
00:52:59,480 --> 00:53:02,520
I got no proof that they didn't
strip out the walls on those

1003
00:53:02,520 --> 00:53:06,080
pictures there and get it to the
right point and, and fix it and,

1004
00:53:06,120 --> 00:53:10,400
and it could be just one
possible thing among many things

1005
00:53:10,400 --> 00:53:12,440
that has contributed to this.
So it's.

1006
00:53:12,960 --> 00:53:16,480
But for sure, let's just say it
was a tutorial, not a

1007
00:53:17,680 --> 00:53:23,040
accusation. 100% I still, I
still think you know it Le it

1008
00:53:23,040 --> 00:53:25,440
leaves other management teams
out there in the in the market

1009
00:53:25,440 --> 00:53:28,600
potentially thinking that, hey,
maybe we can do this better,

1010
00:53:28,600 --> 00:53:30,800
right?
And if you look at the, the

1011
00:53:30,800 --> 00:53:35,000
universe of Aussie midcap miners
and how they're kind of traded

1012
00:53:35,000 --> 00:53:39,280
and the, the, you know, the cash
flow that they should generate

1013
00:53:39,280 --> 00:53:42,840
over the foreseeable future,
Bellevue might might screen an

1014
00:53:42,840 --> 00:53:44,920
opportunity versus the rest of
them.

1015
00:53:45,160 --> 00:53:46,400
So.
Yeah.

1016
00:53:46,400 --> 00:53:49,960
Well, I think what if we did the
numbers before I think you know

1017
00:53:50,000 --> 00:53:54,040
say they get a below buck and
people start thinking what $1.50

1018
00:53:54,040 --> 00:53:57,680
or should do a takeover target.
I think once you what do we say?

1019
00:53:57,680 --> 00:54:00,280
I think once I clear the hedge,
clear the hedge, book the debt

1020
00:54:00,400 --> 00:54:04,920
plus buying 1/2 bill, it's about
a $2 billion deal to do it, but

1021
00:54:04,920 --> 00:54:07,680
it's.
That's less than yeah, that's

1022
00:54:07,680 --> 00:54:11,640
less than yeah, 5050 odd percent
of grey air.

1023
00:54:11,680 --> 00:54:16,160
And less than Spartan and this
all this development is there

1024
00:54:16,560 --> 00:54:18,880
like you're at the ore you're
producing.

1025
00:54:18,880 --> 00:54:23,480
You might just need 3 like it
might be a quarter or two of

1026
00:54:23,480 --> 00:54:27,000
like maybe getting development
ahead or bitter and a bit of

1027
00:54:27,000 --> 00:54:29,560
capital to go to new areas.
But like you're there, the

1028
00:54:29,560 --> 00:54:32,600
infrastructure is there.
It's bloody good infrastructure.

1029
00:54:32,600 --> 00:54:37,360
I mean, so it's been yeah, they
reckon it's a good side in terms

1030
00:54:37,360 --> 00:54:42,240
of like the mill and like it's
brand new, like it's it's and

1031
00:54:42,240 --> 00:54:46,880
that's where the other side of
the arguments come from, from

1032
00:54:46,880 --> 00:54:50,520
people like they're just they're
they're a target as well because

1033
00:54:50,520 --> 00:54:55,560
it's a walk up start to.
Potentially like walk up start

1034
00:54:55,560 --> 00:54:58,840
to what, 150 to 200,000 oz,
they'll come out of halt,

1035
00:54:58,840 --> 00:55:02,440
they'll sell off on a downgrade
and then they'll be a buyer

1036
00:55:02,440 --> 00:55:05,680
buying the buying the dip who
thinks that that they're a

1037
00:55:05,760 --> 00:55:07,560
takeover target.
Now, yeah, I wonder, like, do

1038
00:55:07,560 --> 00:55:12,960
you think it's a function of?
I think it's pretty tightly held

1039
00:55:13,680 --> 00:55:17,720
register, like it's like there's
no, there hasn't been any

1040
00:55:17,720 --> 00:55:22,280
evidence of a strategic that's
come on unless they're sub five

1041
00:55:22,280 --> 00:55:24,200
at the moment.
But you, you would God, you'd

1042
00:55:24,200 --> 00:55:28,640
think in the 90s that someone
would be looking at a 20% stake

1043
00:55:28,880 --> 00:55:30,440
somehow.
Potentially.

1044
00:55:30,440 --> 00:55:33,560
I mean, yeah, because it's
because if it's a short term

1045
00:55:33,560 --> 00:55:38,000
thing and you'd like, it's a
better capitalized miner with

1046
00:55:38,000 --> 00:55:43,120
diversified cash flows who can
reset expectations, reset, you

1047
00:55:43,120 --> 00:55:45,120
know, guidance, clear the hedge
book, all those short term

1048
00:55:45,120 --> 00:55:49,000
pressures, which which can, you
know, be be detrimental.

1049
00:55:50,360 --> 00:55:53,360
Like there's upside there.
It's hard to outbid someone with

1050
00:55:53,360 --> 00:55:55,080
synergies.
And so it's like you look in the

1051
00:55:55,080 --> 00:55:56,840
region who's got big synergies
here.

1052
00:55:57,240 --> 00:55:59,200
And I know it's weird to say
synergies because this thing has

1053
00:55:59,200 --> 00:56:04,240
its own mill, but if you're
sending 6G dirt down the road to

1054
00:56:04,800 --> 00:56:09,080
Agnew or to or to or to Carousel
Dam, I mean, those are like.

1055
00:56:09,080 --> 00:56:11,000
Thunderbox.
Sorry, sorry, Thunderbox.

1056
00:56:11,240 --> 00:56:15,000
It's like a, you know, 6,000,000
ton random kind of operation.

1057
00:56:15,000 --> 00:56:17,440
Much lower processing costs.
You don't even need that meal.

1058
00:56:17,920 --> 00:56:20,360
I think so.
And you can rot it down straight

1059
00:56:20,360 --> 00:56:21,040
away.
Yeah.

1060
00:56:21,120 --> 00:56:23,480
And this would be an if someone
got like interested, this would

1061
00:56:23,480 --> 00:56:26,760
be like an opportunistic kind of
things like having a cash offer.

1062
00:56:26,800 --> 00:56:30,480
Not many no one really has much
cash to like the mid tiers are

1063
00:56:30,480 --> 00:56:33,360
all hungry and stuff, but and
they're making good cash but but

1064
00:56:33,360 --> 00:56:37,040
like this is still a big ticket
to pick up unless you're a big

1065
00:56:37,040 --> 00:56:39,000
player.
Northern Star explicitly can't

1066
00:56:39,000 --> 00:56:43,520
do anything right now because
the the materiality threshold in

1067
00:56:43,520 --> 00:56:45,760
the scheme implementation date.
I think it's like I can't do any

1068
00:56:45,960 --> 00:56:48,040
deals of up to a billion dollars
or something like that.

1069
00:56:49,240 --> 00:56:50,360
I'll be on beyond a billion
dollars.

1070
00:56:50,360 --> 00:56:53,840
And then, yeah, Gold Fields is
clearly preoccupied with Gold

1071
00:56:53,840 --> 00:56:56,840
Road right now.
So yeah, maybe they maybe they

1072
00:56:56,840 --> 00:56:58,800
detour.
Yeah, yeah.

1073
00:56:58,800 --> 00:57:02,840
And like, look, this you could,
you could track this dirt pretty

1074
00:57:02,840 --> 00:57:04,920
far.
Like remember they toll traded

1075
00:57:04,920 --> 00:57:08,920
it at Leonora.
But I don't see like Genesis

1076
00:57:08,920 --> 00:57:12,880
being thrown around as well.
Just I think Raul's done his

1077
00:57:12,880 --> 00:57:16,160
counter cyclical investing.
I don't can't seem taking a

1078
00:57:16,160 --> 00:57:18,800
swing at something like this at
the top of the cycle unless it

1079
00:57:18,800 --> 00:57:22,320
got pretty a lot cheaper.
Never say I never got.

1080
00:57:22,320 --> 00:57:24,320
I was fucking wrong about
everything this week.

1081
00:57:24,320 --> 00:57:28,360
I said goldfield wouldn't do
anything, but it's like, but

1082
00:57:28,360 --> 00:57:32,000
this this will be a mine that
will go for a long time like

1083
00:57:32,000 --> 00:57:37,000
this is, but it it appears that
it's just I'll I'll be very

1084
00:57:37,000 --> 00:57:41,720
interested to see if there's two
250,000 oz production growth

1085
00:57:41,720 --> 00:57:44,760
target that they doubled down on
on the back of guidance

1086
00:57:44,760 --> 00:57:47,680
downgrades.
I think people just want to see

1087
00:57:47,680 --> 00:57:53,840
that pulled like just just
commit to a 200,000 oz operation

1088
00:57:53,840 --> 00:57:58,000
at 2 1/2 thousand all in
sustaining or something and that

1089
00:57:58,000 --> 00:58:01,280
will print will print cash in
the future and just a bit more

1090
00:58:01,280 --> 00:58:04,520
realistic on the on the growth.
I think it's just once it just

1091
00:58:04,520 --> 00:58:06,760
needs to be tidied up.
But yeah, but obviously pulling

1092
00:58:06,760 --> 00:58:10,440
that target will be get the
stock hammered a bit.

1093
00:58:10,440 --> 00:58:14,240
But yeah, we'll wait and wait
and see for I think it's it says

1094
00:58:14,240 --> 00:58:17,920
it's coming out a whole Friday.
I've heard Monday.

1095
00:58:19,360 --> 00:58:22,720
I think if it's Monday, not
Friday, there's probably going

1096
00:58:22,720 --> 00:58:25,080
to be a bit more substance, a
bit more content in the

1097
00:58:25,080 --> 00:58:29,640
announcement, possibly needing a
bit extra time, but.

1098
00:58:30,280 --> 00:58:33,160
We'll say that I think that's a
that's a good spot to leave it.

1099
00:58:33,360 --> 00:58:38,640
A lot of gold chat.
Buddy, we're a very pro cyclical

1100
00:58:38,640 --> 00:58:45,520
podcast at the moment.
We are reflective of the the

1101
00:58:45,560 --> 00:58:49,120
interest in the market.
People want to hear about gold

1102
00:58:49,120 --> 00:58:52,680
at the moment.
Yes, brought up there'll be shit

1103
00:58:52,680 --> 00:58:56,360
loads of gold underground
operators.

1104
00:58:56,360 --> 00:58:58,800
Probably everything will be
about gold there. 100 bucks off.

1105
00:58:58,800 --> 00:59:01,280
Bloody like they're those
tickets flying out the door

1106
00:59:01,880 --> 00:59:04,600
mate.
GRX now I'll do them around the

1107
00:59:04,600 --> 00:59:07,560
other way next time.
Global resources innovation Expo

1108
00:59:07,760 --> 00:59:10,840
deals for cheap tickets there on
in the show notes as well.

1109
00:59:10,840 --> 00:59:14,280
Breezy in my now what do we got
Partners, Mineral mining

1110
00:59:14,280 --> 00:59:17,200
services, Grounded, Samba,
ground sport, CRE insurance,

1111
00:59:17,200 --> 00:59:21,880
catering, WA water balls, Sweep,
Quattro and Cross boundary

1112
00:59:21,880 --> 00:59:23,920
energy.
Thank you very.

1113
00:59:24,880 --> 00:59:27,480
Much information contained in
this episode of Money of Mine is

1114
00:59:27,480 --> 00:59:29,640
of general nature only and does
not take into account the

1115
00:59:29,640 --> 00:59:33,280
objectives, financial situation
or needs of any particular

1116
00:59:33,280 --> 00:59:35,320
person.
Before making any investment

1117
00:59:35,320 --> 00:59:38,360
decision, you should consult
with your financial advisor and

1118
00:59:38,360 --> 00:59:41,520
consider how appropriate the
advice is to your objectives,

1119
00:59:41,720 --> 00:59:43,720
financial situation and needs.