Village Main Reef
No, I have not l ost my mind because I ’m suggesting a gold stock to buy − the reasoning has nothing to do with being bullish on gold or bullish on gold mining companies (I am neither). Rather it is because of the offer by HeavenSent to acquire all the shares in Village at 1 225c.
The latest update says that the offer is now “a firm intention offer” and the monies payable if the deal goes ahead have been lodged with the Takeover Regulation Panel.
So buying Village at below 1 100c (the stock is trading at 1 070c at the time of writing) gives a very possible exit price of 1 225c if the deal goes ahead. One issue is to keep the purchase costs low and one could get a return of over 10%, and while we don’t have any timelines, it is unlikely to take more than six months.
The risk is that the deal might collapse, and while that seems unlikely, it is possible. The result being that one is l eft holding a gold mine and the price will likely fall.