News

June 30, 2008

Cleveland-Cliffs Denies It's Going To Make A Bid For Golden West, But Watch This Space

By Our Man In Oz

When the chairman of a football club says he has absolute confidence in the coach it’s fair bet that the coach ought to start reading the situations vacant column the next morning. Flip that around and consider what it means when a prospective corporate predator says it: “does not have any current intention to make a takeover”. It’s the same really. A case of saying one thing and meaning another, which is pretty much what appears to have been happening to the small Australian iron ore hopeful, Golden West Resources. Once in the cross-hairs of a fellow small Aussie called Fairstar Resources, Golden West is now officially not (repeat, officially not) in the sights of the big U.S. miner, Cleveland-Cliffs – which is why the yank company keeps buying Golden West shares.

If this seems a little confusing, it is. But, take the time to understand the fun and games at Golden West and you might discover a hidden gem. First step is to focus on the prize, a large but remote deposit of high grade, direct shipping haematite iron ore. Second step is the latest 85 per cent increase in the price of iron ore which makes virtually any deposit of the stuff this side of the moon very valuable. Step three is to try (but probably fail) to understand the strange corporate events...