Welcome!

Search Authors: Carmen Gonzalez, Pat Romanski, Elizabeth White, Aditya Banerjee, Sematext Blog

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
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using the URL as a basic building block, we open this up and get the same resilience that the web enjoys.
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect at GE, and Ibrahim Gokcen, who leads GE's advanced IoT analytics, focused on the Internet of Things / Industrial Internet and how to make it operational for business end-users. Learn about the challenges posed by machine and sensor data and how to marry it with enterprise data. They also discussed the tips and tricks to provide the Industrial Internet as an end-user consumable service using Big Data Analytics and Industrial Cloud.
Things are being built upon cloud foundations to transform organizations. This CEO Power Panel at 15th Cloud Expo, moderated by Roger Strukhoff, Cloud Expo and @ThingsExpo conference chair, addressed the big issues involving these technologies and, more important, the results they will achieve. Rodney Rogers, chairman and CEO of Virtustream; Brendan O'Brien, co-founder of Aria Systems, Bart Copeland, president and CEO of ActiveState Software; Jim Cowie, chief scientist at Dyn; Dave Wagstaff, VP and chief architect at BSQUARE Corporation; Seth Proctor, CTO of NuoDB, Inc.; and Andris Gailitis, C...
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it's a mix of architectural styles ...
The Industrial Internet revolution is now underway, enabled by connected machines and billions of devices that communicate and collaborate. The massive amounts of Big Data requiring real-time analysis is flooding legacy IT systems and giving way to cloud environments that can handle the unpredictable workloads. Yet many barriers remain until we can fully realize the opportunities and benefits from the convergence of machines and devices with Big Data and the cloud, including interoperability, data security and privacy.
Technology is enabling a new approach to collecting and using data. This approach, commonly referred to as the "Internet of Things" (IoT), enables businesses to use real-time data from all sorts of things including machines, devices and sensors to make better decisions, improve customer service, and lower the risk in the creation of new revenue opportunities. In his General Session at Internet of @ThingsExpo, Dave Wagstaff, Vice President and Chief Architect at BSQUARE Corporation, discuss the real benefits to focus on, how to understand the requirements of a successful solution, the flow of ...
Cloud Expo 2014 TV commercials will feature @ThingsExpo, which was launched in June, 2014 at New York City's Javits Center as the largest 'Internet of Things' event in the world.
"People are a lot more knowledgeable about APIs now. There are two types of people who work with APIs - IT people who want to use APIs for something internal and the product managers who want to do something outside APIs for people to connect to them," explained Roberto Medrano, Executive Vice President at SOA Software, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Performance is the intersection of power, agility, control, and choice. If you value performance, and more specifically consistent performance, you need to look beyond simple virtualized compute. Many factors need to be considered to create a truly performant environment. In his General Session at 15th Cloud Expo, Harold Hannon, Sr. Software Architect at SoftLayer, discussed how to take advantage of a multitude of compute options and platform features to make cloud the cornerstone of your online presence.
In this Women in Technology Power Panel at 15th Cloud Expo, moderated by Anne Plese, Senior Consultant, Cloud Product Marketing at Verizon Enterprise, Esmeralda Swartz, CMO at MetraTech; Evelyn de Souza, Data Privacy and Compliance Strategy Leader at Cisco Systems; Seema Jethani, Director of Product Management at Basho Technologies; Victoria Livschitz, CEO of Qubell Inc.; Anne Hungate, Senior Director of Software Quality at DIRECTV, discussed what path they took to find their spot within the technology industry and how do they see opportunities for other women in their area of expertise.
DevOps Summit 2015 New York, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete at launch. DevOps may be disruptive, but it is essential.
Wearable devices have come of age. The primary applications of wearables so far have been "the Quantified Self" or the tracking of one's fitness and health status. We propose the evolution of wearables into social and emotional communication devices. Our BE(tm) sensor uses light to visualize the skin conductance response. Our sensors are very inexpensive and can be massively distributed to audiences or groups of any size, in order to gauge reactions to performances, video, or any kind of presentation. In her session at @ThingsExpo, Jocelyn Scheirer, CEO & Founder of Bionolux, will discuss ho...
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.
“With easy-to-use SDKs for Atmel’s platforms, IoT developers can now reap the benefits of realtime communication, and bypass the security pitfalls and configuration complexities that put IoT deployments at risk,” said Todd Greene, founder & CEO of PubNub. PubNub will team with Atmel at CES 2015 to launch full SDK support for Atmel’s MCU, MPU, and Wireless SoC platforms. Atmel developers now have access to PubNub’s secure Publish/Subscribe messaging with guaranteed ¼ second latencies across PubNub’s 14 global points-of-presence. PubNub delivers secure communication through firewalls, proxy ser...
We’re no longer looking to the future for the IoT wave. It’s no longer a distant dream but a reality that has arrived. It’s now time to make sure the industry is in alignment to meet the IoT growing pains – cooperate and collaborate as well as innovate. In his session at @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, will examine the key ingredients to IoT success and identify solutions to challenges the industry is facing. The deep industry expertise behind this presentation will provide attendees with a leading edge view of rapidly emerging IoT oppor...
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective storage designed to handle the massive surge in back-end data in a world where timely analytics is e...
"There is a natural synchronization between the business models, the IoT is there to support ,” explained Brendan O'Brien, Co-founder and Chief Architect of Aria Systems, in this SYS-CON.tv interview at the 15th International Cloud Expo®, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
The BPM world is going through some evolution or changes where traditional business process management solutions really have nowhere to go in terms of development of the road map. In this demo at 15th Cloud Expo, Kyle Hansen, Director of Professional Services at AgilePoint, shows AgilePoint’s unique approach to dealing with this market circumstance by developing a rapid application composition or development framework.