Welcome!

Cognitive Computing Authors: Liz McMillan, Elizabeth White, Pat Romanski, Yeshim Deniz, Kevin Benedict

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.

Contacts:
Chris Charlwood
HRG Shareholder
[email protected]
604-718-2668

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
SYS-CON Events announced today that N3N will exhibit at SYS-CON's @ThingsExpo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. N3N’s solutions increase the effectiveness of operations and control centers, increase the value of IoT investments, and facilitate real-time operational decision making. N3N enables operations teams with a four dimensional digital “big board” that consolidates real-time live video feeds alongside IoT sensor data a...
Mobile device usage has increased exponentially during the past several years, as consumers rely on handhelds for everything from news and weather to banking and purchases. What can we expect in the next few years? The way in which we interact with our devices will fundamentally change, as businesses leverage Artificial Intelligence. We already see this taking shape as businesses leverage AI for cost savings and customer responsiveness. This trend will continue, as AI is used for more sophistica...
What is the best strategy for selecting the right offshore company for your business? In his session at 21st Cloud Expo, Alan Winters, U.S. Head of Business Development at MobiDev, will discuss the things to look for - positive and negative - in evaluating your options. He will also discuss how to maximize productivity with your offshore developers. Before you start your search, clearly understand your business needs and how that impacts software choices.
Real IoT production deployments running at scale are collecting sensor data from hundreds / thousands / millions of devices. The goal is to take business-critical actions on the real-time data and find insights from stored datasets. In his session at @ThingsExpo, John Walicki, Watson IoT Developer Advocate at IBM Cloud, will provide a fast-paced developer journey that follows the IoT sensor data from generation, to edge gateway, to edge analytics, to encryption, to the IBM Bluemix cloud, to Wa...
SYS-CON Events announced today that Fusic will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Fusic Co. provides mocks as virtual IoT devices. You can customize mocks, and get any amount of data at any time in your test. For more information, visit https://fusic.co.jp/english/.
SYS-CON Events announced today that Massive Networks, that helps your business operate seamlessly with fast, reliable, and secure internet and network solutions, has been named "Exhibitor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. As a premier telecommunications provider, Massive Networks is headquartered out of Louisville, Colorado. With years of experience under their belt, their team of...
SYS-CON Events announced today that Enroute Lab will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Enroute Lab is an industrial design, research and development company of unmanned robotic vehicle system. For more information, please visit http://elab.co.jp/.
SYS-CON Events announced today that MIRAI Inc. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MIRAI Inc. are IT consultants from the public sector whose mission is to solve social issues by technology and innovation and to create a meaningful future for people.
SYS-CON Events announced today that Mobile Create USA will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Mobile Create USA Inc. is an MVNO-based business model that uses portable communication devices and cellular-based infrastructure in the development, sales, operation and mobile communications systems incorporating GPS capabi...
SYS-CON Events announced today that Interface Corporation will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Interface Corporation is a company developing, manufacturing and marketing high quality and wide variety of industrial computers and interface modules such as PCIs and PCI express. For more information, visit http://www.i...
SYS-CON Events announced today that Keisoku Research Consultant Co. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Keisoku Research Consultant, Co. offers research and consulting in a wide range of civil engineering-related fields from information construction to preservation of cultural properties. For more information, vi...
There is huge complexity in implementing a successful digital business that requires efficient on-premise and cloud back-end infrastructure, IT and Internet of Things (IoT) data, analytics, Machine Learning, Artificial Intelligence (AI) and Digital Applications. In the data center alone, there are physical and virtual infrastructures, multiple operating systems, multiple applications and new and emerging business and technological paradigms such as cloud computing and XaaS. And then there are pe...
SYS-CON Events announced today that SIGMA Corporation will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. uLaser flow inspection device from the Japanese top share to Global Standard! Then, make the best use of data to flip to next page. For more information, visit http://www.sigma-k.co.jp/en/.
SYS-CON Events announced today that B2Cloud will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. B2Cloud specializes in IoT devices for preventive and predictive maintenance in any kind of equipment retrieving data like Energy consumption, working time, temperature, humidity, pressure, etc.
Agile has finally jumped the technology shark, expanding outside the software world. Enterprises are now increasingly adopting Agile practices across their organizations in order to successfully navigate the disruptive waters that threaten to drown them. In our quest for establishing change as a core competency in our organizations, this business-centric notion of Agile is an essential component of Agile Digital Transformation. In the years since the publication of the Agile Manifesto, the conn...
While some developers care passionately about how data centers and clouds are architected, for most, it is only the end result that matters. To the majority of companies, technology exists to solve a business problem, and only delivers value when it is solving that problem. 2017 brings the mainstream adoption of containers for production workloads. In his session at 21st Cloud Expo, Ben McCormack, VP of Operations at Evernote, will discuss how data centers of the future will be managed, how th...
SYS-CON Events announced today that NetApp has been named “Bronze Sponsor” of SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. NetApp is the data authority for hybrid cloud. NetApp provides a full range of hybrid cloud data services that simplify management of applications and data across cloud and on-premises environments to accelerate digital transformation. Together with their partners, NetApp em...
SYS-CON Events announced today that Nihon Micron will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Nihon Micron Co., Ltd. strives for technological innovation to establish high-density, high-precision processing technology for providing printed circuit board and metal mount RFID tags used for communication devices. For more inf...
SYS-CON Events announced today that Suzuki Inc. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Suzuki Inc. is a semiconductor-related business, including sales of consuming parts, parts repair, and maintenance for semiconductor manufacturing machines, etc. It is also a health care business providing experimental research for...
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...