Gold Resource Corp (GORO)

[Neverhadawinner]

Cork

I think your April questions have been answered. GORO is now a Canadian run company whose CEO ran off all of the old Executive Team and replaced them with an all Canadian team. The reason for this action remains clouded but the results are very clear. GORO has stopped growing and is stagnant.

They now want to dilute the stock further. Why: Leverage in a buyout.

I believe GORO is up for sale and the bidder is NEWMONT. Newmont Corporation just completed its purchase of GT Gold in Canada for CA$ 3.25 per share. GT Gold traded at around CA$ 1.00 in January 2020. GT Gold had 130 million shares outstanding at time of sale. That is a CA$ 425 million acquisition.

If you look at GORO current share price $2.79 with 75 million shares outstanding, it has a market value of $210 million. That would be CA$261 million market value. CA$425 million divided by 75 million shares equates to around CA$5.65 per share. So a CA$6.00 per share bid would not be out of the question.

Newmont is engaged in all the same metal areas (Gold, Silver, Copper, Zinc, and Lead) as GORO. However, their North American operations are limited to : North America segment consists primarily of Carlin, Phoenix, Twin Creeks and Long Canyon in the state of Nevada, and Cripple Creek &Victor (CC&V) in the state of Colorado, in the United States.

Note the addition of Canada and the absence of Mexico.

Have I discovered an upcoming acquisition? Only time will tell. But the split of GORO in December 2020 is becoming more clear and the pull away from FTCO is obvious. Now the question is who is buying GORO and who is shorting GORO. Answer those questions and you win the $64,000.

Have a good holiday!