Friday Flashback

THE WEEKLY WRAP: The week kicked off with what the industry has been waiting for since the GFC – a good old-fashioned opportunistic take over.

The danger of having an attractive project in these lean times was highlighted when Orbis Gold (ASX: OBS) received a conditional, non‐binding and indicative proposal from Canadian-based mining house SEMAFO Inc. to acquire 100 per cent of Orbis’ issued ordinary shares.

SEMAFO is offering cash consideration of between 62 cents to 65 cents per share – not a bad premium for the current 42 cents, which is the company’s highest share price and was only reached on small volumes the previous Friday.

SEMAFO operates the Mana Mine in Burkina Faso, which includes the high-grade Siou and Fofina deposits.

Orbis told its shareholders not to do anything – considering they remained in a trading halt that would be their obvious choice.

Day two of the Orbis saga saw the chess game was well and truly underway with the company releasing its Scoping Study – that in the end delivered no surprises – the Natougou gold deposit has stood up to all expectations.

Once the trading halt was lifted shareholder loyalty didn’t exactly fly out the window but there was enough movement for the company’s share price to close at 60 cents with just under 1.7 million of its 250 million shares changing hands.

SEMAFO made the bid official on Thursday telling Orbis shareholders they had the choice to take up its offer of 65 cents “in cash and a substantial premium”, or sanction the Greenstone placement at 42 cents for a “dilutive financing and uncertain future”.

This has the potential to be a nasty, strategic battle that should prove more beguiling than the love life of Blake the Bachelor.

Western Australia Premier Colin Barnett continued to get under the skin of the big miners, Rio Tinto (ASX: RIO) and BHP Billiton (ASX: BHP) by suggesting they are colluding to keep iron ore prices low.

Rio denied this in the strongest Lady Macbeth fashion as iron ore prices endured another bad day.

The Roadhouse wonders what odds Tom Waterhouse may be offering on the price hitting US$50 before it manages to scrape its way back to US$90.

Barnett later recanted to an extent, saying he said they appeared to be acting ‘in concert’ rather than colluding.

Rio boss Sam Walsh took the opportunity to remind everybody this was the same government that had approved his company’s expansion plans.

Barnett also has expansion plans well underway around the City of Perth with the development of Elizabeth Quay and the annexation of Northbridge to the main CBD well underway.

He has some big bills to pay and the drop in iron ore levies isn’t helping his cause, which can only be a great concern for all the WA-based gold miners who are making a stand against any possible rises to the state gold royalties.

Despite all this the market managed to reach Thursday’s close in positive territory.