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Yamana Gold, Inc. Message Board

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  • hapiwondrer hapiwondrer May 6, 2011 4:22 PM Flag

    you can smell the fear

    OK. Share buyback should work, too. If instead of having his compensation increased by ~$5 M, a share buyback was made, which would represent about 420,000 shares. That would be insignificant on a financial basis, but would definitely change the attitude of many shareholders towards Marrone.

    Of more significance would be to take the receipts of the Agua Rica deal, as reported,

    “…Xstrata Copper and Goldcorp can collectively elect to exercise the option at any time during the four-year period through an “approval-to-proceed” decision for construction of the Agua Rica project. On approval to proceed, Yamana would receive $150 million and on commissioning an additional $50 million. Yamana would also retain the right to a deferred payment related to 65% of the payable gold production from Agua Rica to a maximum of 2.3 million oz. …” There are other examples of money that has been brought into the company through these kinds of arrangements that could raise the percentage in shares outstanding even more.

    If $200M of that was used as a share buyback that would represent about 17M shares at current prices, which as a percentage of shares outstanding is about 2%, or about 1/4 point. And that could be considered a “leveraged” newsworthy event to put Yamana share prices over the top, which would more than fund other strategies for mine expansion, such as buyouts achieved with share exchanges made possible through share appreciation.

    But these CEOs seem incapable of doing anything that even hints at a defense of share price. Instead their greatest capability is to sit on their behinds and count their compensation.

    That is also why, as previously stated, “…it begs the question as to whether a certain synergy exists between PM mining company CEOs and the fiat money crowd, whether it is central banks, politicians or major media sources. It’s kind of like in politics when a Republican refers to a Democrat as his “friend and colleague on the other side of the isle”. All these people are about is pushing paper or empty words onto a gullible public.

    The corruption at the top is complete and total across a wide spectrum of those in leadership positions, corporate, political, financial or mainstream media. And even if they “talk the talk”, seldom do they “walk the walk”.

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    • Another beef you can add to it is that, almost without exception, the Board is made up of other miners, geologists, engineers. There are no "outside directors". They act this way because this is all they know. Overall, I think either option would be good, however the stock buyback in the short term would be most advantageous.

      Ultimately what will cause management to second guess is via voting of proxies. I found it interesting that he indicated there was over 80% approval. That means almost 20% disapproved(!!!!), which is very revealing (ordinarily management has 95% or greater). Because of this, I would not be surprised if some investment bankers took positions, then approached a larger miner. The way the price is acting, it is almost begging for this to happen.

      That said, I truly was impressed how management had kept costs down in an increasingly hostile environment to the dollar and generally increasing fuel costs. I hope the hedge on silver of 50:1 protected us when silver fell out of bed.

2.49+0.16(+6.87%)Oct 9 4:00 PMEDT