News

December 17, 2008

The Offer From Rusoro Could Be The Best Christmas Present Shareholders in Gold Reserve Get This Year

By Charles Wyatt

Canadian-listed Rusoro Mining, which presented at our most recent Minesite Forum on 9th December, has made a take-over bid for Gold Reserve Inc, a company which is also listed in Canada as well as on the AMEX. Minews detected a slight air of nervousness about director George Salamis at the time and limited the questions that were put to him after the presentation. George has now admitted that he was worried anyone might have got wind of the coming bid and asked a question about it which he would have been unable to answer. Even so, he did not let us down, and gave an excellent presentation on the day which means that London’s mining community has a good knowledge of his company and will be able to understand the logic of this bid.

The bid is defined as hostile, though Rusoro did make a friendly approach in September which was turned down. It values Gold Reserve at C$61.6 million on the basis of three Rusoro shares for each Gold Reserve Class A share or equity unit. This puts a price of C$1.08 on each Gold Reserve share, which is more than twice the share price prior to the bid. Both companies have seen their share prices fall heavily in the second half of this year, in common with most of their peers, but this is now a...