Click here to close now.

Welcome!

.NET Authors: Carmen Gonzalez, Elizabeth White, Liz McMillan, Greg O'Connor, Jason Bloomberg

News Feed Item

HRG vs. Nord-9 Months YTD 2012 Comparison

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 11/20/12 --

To High River Gold Shareholders,

Both High River Gold and Nord Gold put out their Q3 financial results last week. Below is a comparison of the first 9 months of 2012:


HRG had production of 254.8koz. vs. Nord at 515.0k oz. - 49.5% of Nord's    
total.                                                                      
HRG had revenues of $422.5M vs. Nord at 851.1M - 49.6% of Nord's total.     
HRG had EBITDA of $208.8M vs. Nord at $349.2M - 59.8% of Nord's total.      
HRG had cash flow of $179.2M vs. Nord at $71.0M - 252% of Nord's total.     
HRG had a net profit of $137.0M vs. Nord at $123.2M - 111% of Nord's total. 
At end of Q3, HRG had liquidity of $257.7M (including $89.4M third party    
stock (Detour Gold), $113.3M loans to Nord and $55M in cash). It had $10.3M 
debt owed to the 50% partner in Prognoz.                                    
At end of Q3, Nord had $102.4M in cash and total debt of $523.2M.           

Note: these numbers reflect 100% of both companies and do not deduct for non-controlling interests.

Without HRG, in the first 9 months of the year, Nord would have had negative cash flow of $108.2M, a loss of $13.8M and a negative cash balance of $10.9M. The EBITDA comparison continues to show the superior performance of HRG's assets over Nord's non-HRG assets. The cash flow and profit comparisons highlight the substantial debt that Nord is carrying.

There have been a few interesting events recently that are worth mentioning. Firstly, Nord has repaid $52.7M in loans to HRG bringing the total loans from HRG down to $113M. Secondly, in HRG's press release it says, "The Bissa project is on track to deliver first gold in H1 2013 and we now believe that production of gold at Bissa can be started in the earlier part of the announced period. " To remind you, a Morgan Stanley report dated Feb. 17, 2012 projects that Bissa will produce 95koz. of gold in 2013 and add $145M of EBITDA.

In regards to the Prognoz silver project, it is interesting to note that certain parties to the lock-up agreements (for the current offer) have some connection to both HRG and Prognoz via direct and indirect investments. Therefore, it would not be surprising if HRG/Nord and the other 50% partners in Prognoz come to some sort of agreement on settling legal disputes and bankruptcy proceedings next year. As I have stated previously, a spinoff of Prognoz would be beneficial to all parties - especially considering certain predictions that silver will play catch up to gold in terms of historic ratios. Prognoz is in the top ten silver properties in the world in terms of resources, but tops the list with grades.

Nord's most recent offer for HRG of $1.40 share is at a P/E of 7.3 vs. the industry average (for mid-cap gold producers) at a 25 P/E. Based on this average, Nord's cash offer should be $4.80/share. The share swap offer of .285 Nord share for each HRG share translates to 100% of HRG being worth 58% of Nord's total value. This is almost equal to the 59.8% of Nord's EBITDA contributed by HRG, however, this does not reflect HRG minority's portion of the $247.4M of HRG's net liquidity. When factoring this in, it brings 100% of HRG up to 70% of Nord's total value. This means HRG shareholders should have been offered 76M shares of Nord which works out to an exchange of .363 Nord share for each HRG share (calcs linked below). Even this number gives zero value for the Prognoz property.

Nord's offer expires in one week's time. To date we have collected confirmations from shareholders with approx. 90.2M shares (10.73% of total HRG shares and 43% of minority) that they will not tender to Nord's offer. This includes shares owned in funds managed by Eric Sprott (HRG's largest minority shareholder). Nord would have needed 90% of minority to tender to the current offer in order to squeeze the rest out. With 43% of minority indicating they will not tender, this should prevent this from happening on the Nov. 27th expiry date. Also, since those holding over 10% of total shares have indicate they will not tender, Nord will not be able to use an exemption eliminating the requirement for a majority of minority vote in a second stage transaction. To use this exemption they would have needed to own 90% of total shares. Therefore, if Nord wants to continue its buyout effort and acquire all shares and vote the shares tendered to this offer, it will have to announce a subsequent amalgamation offer and complete the transaction within 120 days of the expiry of the current offer. Nord would need to call a special shareholders meeting with proper notice, which puts the earliest possible meeting dates around Dec. 31 - Jan. 2 range - depending on mailing and preparation time. At this meeting, only those voting in person or by proxy count. If a majority of minority is required, we may already be able to win this vote with the 90.2M shares if Nord cannot get a greater number to vote in its favour. However, to be certain we will be able to block, it would be best if we collect another 14.6M shares to garner ultimate majority of minority (104.8M shares). As with Nord's take-over attempt in 2009, there are certain funds that will not confirm their share counts or intentions, but will vote with us anyway. Therefore, I believe our numbers to be greater than stated above.

If any funds owning HRG shares have not contacted me yet, I encourage you to do so. Confirming that we have support of majority of minority will send Nord the message that they need to up their offer significantly. If we defeat this offer outright, we could see a significant increase in HRG's share price. In 2009, when we defeated Severstal/Nord's offer, HRG's share price tripled within 5 months of the offer expiry date.

Link to HRG Q3 results

http://finance.yahoo.com/news/high-river-financial-results-third-221500497.html

Link to share swap calculations

http://freepdfhosting.com/f7fd1a7001.pdf

Disclaimer: I have received written or verbal confirmations of shareholder counts from those that will not tender. If any of these shareholders have changed their mind, since sold their shares, or not been accurate in their statements, it will change the share counts stated above.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Health care systems across the globe are under enormous strain, as facilities reach capacity and costs continue to rise. M2M and the Internet of Things have the potential to transform the industry through connected health solutions that can make care more efficient while reducing costs. In fact, Vodafone's annual M2M Barometer Report forecasts M2M applications rising to 57 percent in health care and life sciences by 2016. Lively is one of Vodafone's health care partners, whose solutions enable older adults to live independent lives while staying connected to loved ones. M2M will continue to gr...
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here
SYS-CON Events announced today that Ciqada will exhibit at SYS-CON's @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Ciqada™ makes it easy to connect your products to the Internet. By integrating key components - hardware, servers, dashboards, and mobile apps - into an easy-to-use, configurable system, your products can quickly and securely join the internet of things. With remote monitoring, control, and alert messaging capability, you will meet your customers' needs of tomorrow - today! Ciqada. Let your products take flight. For more inform...
SYS-CON Events announced today that GENBAND, a leading developer of real time communications software solutions, has been named “Silver Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. The GENBAND team will be on hand to demonstrate their newest product, Kandy. Kandy is a communications Platform-as-a-Service (PaaS) that enables companies to seamlessly integrate more human communications into their Web and mobile applications - creating more engaging experiences for their customers and boosting collaboration and productiv...
Dave will share his insights on how Internet of Things for Enterprises are transforming and making more productive and efficient operations and maintenance (O&M) procedures in the cleantech industry and beyond. Speaker Bio: Dave Landa is chief operating officer of Cybozu Corp (kintone US). Based in the San Francisco Bay Area, Dave has been on the forefront of the Cloud revolution driving strategic business development on the executive teams of multiple leading Software as a Services (SaaS) application providers dating back to 2004. Cybozu's kintone.com is a leading global BYOA (Build Your O...
The best mobile applications are augmented by dedicated servers, the Internet and Cloud services. Mobile developers should focus on one thing: writing the next socially disruptive viral app. Thanks to the cloud, they can focus on the overall solution, not the underlying plumbing. From iOS to Android and Windows, developers can leverage cloud services to create a common cross-platform backend to persist user settings, app data, broadcast notifications, run jobs, etc. This session provides a high level technical overview of many cloud services available to mobile app developers, includi...
SYS-CON Events announced today that BroadSoft, the leading global provider of Unified Communications and Collaboration (UCC) services to operators worldwide, has been named “Gold Sponsor” of SYS-CON's WebRTC Summit, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. BroadSoft is the leading provider of software and services that enable mobile, fixed-line and cable service providers to offer Unified Communications over their Internet Protocol networks. The Company’s core communications platform enables the delivery of a range of enterprise and consumer calling...
While not quite mainstream yet, WebRTC is starting to gain ground with Carriers, Enterprises and Independent Software Vendors (ISV’s) alike. WebRTC makes it easy for developers to add audio and video communications into their applications by using Web browsers as their platform. But like any market, every customer engagement has unique requirements, as well as constraints. And of course, one size does not fit all. In her session at WebRTC Summit, Dr. Natasha Tamaskar, Vice President, Head of Cloud and Mobile Strategy at GENBAND, will explore what is needed to take a real time communications ...
The 17th International Cloud Expo has announced that its Call for Papers is open. 17th International Cloud Expo, to be held November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, APM, APIs, Microservices, Security, Big Data, Internet of Things, DevOps and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal today!
WebRTC is an up-and-coming standard that enables real-time voice and video to be directly embedded into browsers making the browser a primary user interface for communications and collaboration. WebRTC runs in a number of browsers today and is currently supported in over a billion installed browsers globally, across a range of platform OS and devices. Today, organizations that choose to deploy WebRTC applications and use a host machine that supports audio through USB or Bluetooth can use Plantronics products to connect and transit or receive the audio associated with the WebRTC session.
What exactly is a cognitive application? In her session at 16th Cloud Expo, Ashley Hathaway, Product Manager at IBM Watson, will look at the services being offered by the IBM Watson Developer Cloud and what that means for developers and Big Data. She'll explore how IBM Watson and its partnerships will continue to grow and help define what it means to be a cognitive service, as well as take a look at the offerings on Bluemix. She will also check out how Watson and the Alchemy API team up to offer disruptive APIs to developers.
The IoT Bootcamp is coming to Cloud Expo | @ThingsExpo on June 9-10 at the Javits Center in New York. Instructor. Registration is now available at http://iotbootcamp.sys-con.com/ Instructor Janakiram MSV previously taught the famously successful Multi-Cloud Bootcamp at Cloud Expo | @ThingsExpo in November in Santa Clara. Now he is expanding the focus to Janakiram is the founder and CTO of Get Cloud Ready Consulting, a niche Cloud Migration and Cloud Operations firm that recently got acquired by Aditi Technologies. He is a Microsoft Regional Director for Hyderabad, India, and one of the f...
As enterprises move to all-IP networks and cloud-based applications, communications service providers (CSPs) – facing increased competition from over-the-top providers delivering content via the Internet and independently of CSPs – must be able to offer seamless cloud-based communication and collaboration solutions that can scale for small, midsize, and large enterprises, as well as public sector organizations, in order to keep and grow market share. The latest version of Oracle Communications Unified Communications Suite gives CSPs the capability to do just that. In addition, its integration ...
SYS-CON Events announced today that Litmus Automation will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Litmus Automation’s vision is to provide a solution for companies that are in a rush to embrace the disruptive Internet of Things technology and leverage it for real business challenges. Litmus Automation simplifies the complexity of connected devices applications with Loop, a secure and scalable cloud platform.
In 2015, 4.9 billion connected "things" will be in use. By 2020, Gartner forecasts this amount to be 25 billion, a 410 percent increase in just five years. How will businesses handle this rapid growth of data? Hadoop will continue to improve its technology to meet business demands, by enabling businesses to access/analyze data in real time, when and where they need it. Cloudera's Chief Technologist, Eli Collins, will discuss how Big Data is keeping up with today's data demands and how in the future, data and analytics will be pervasive, embedded into every workflow, application and infra...
As Marc Andreessen says software is eating the world. Everything is rapidly moving toward being software-defined – from our phones and cars through our washing machines to the datacenter. However, there are larger challenges when implementing software defined on a larger scale - when building software defined infrastructure. In his session at 16th Cloud Expo, Boyan Ivanov, CEO of StorPool, will provide some practical insights on what, how and why when implementing "software-defined" in the datacenter.
SYS-CON Media announced today that @ThingsExpo Blog launched with 7,788 original stories. @ThingsExpo Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @ThingsExpo Blog can be bookmarked. The Internet of Things (IoT) is the most profound change in personal and enterprise IT since the creation of the Worldwide Web more than 20 years ago.
The world's leading Cloud event, Cloud Expo has launched Microservices Journal on the SYS-CON.com portal, featuring over 19,000 original articles, news stories, features, and blog entries. DevOps Journal is focused on this critical enterprise IT topic in the world of cloud computing. Microservices Journal offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. Follow new article posts on Twitter at @MicroservicesE
SYS-CON Events announced today that robomq.io will exhibit at SYS-CON's @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. robomq.io is an interoperable and composable platform that connects any device to any application. It helps systems integrators and the solution providers build new and innovative products and service for industries requiring monitoring or intelligence from devices and sensors.
Wearable technology was dominant at this year’s International Consumer Electronics Show (CES) , and MWC was no exception to this trend. New versions of favorites, such as the Samsung Gear (three new products were released: the Gear 2, the Gear 2 Neo and the Gear Fit), shared the limelight with new wearables like Pebble Time Steel (the new premium version of the company’s previously released smartwatch) and the LG Watch Urbane. The most dramatic difference at MWC was an emphasis on presenting wearables as fashion accessories and moving away from the original clunky technology associated with t...