So we now know why Minera Andes (MAI.to) tanked 10% yesterday Monday, as word must have leaked out to the inside trading scumballs in Canada about Rob McEwen's latest brainwave. Here's how today's NR kicks off, click through for more:
Press Release Source: US Gold Corporation and Minera Andes Inc. On Tuesday June 14, 2011, 8:00 am EDTTORONTO, ONTARIO--(Marketwire - 06/14/11) - US Gold Corporation (NYSE:UXG - News)(TSX:UXG - News) and Minera Andes Inc. (TSX:MAI - News)(OTC.BB:MNEAF - News) announce that Rob McEwen, Chairman, CEO, and largest shareholder of both companies has proposed to combine these companies to create a high growth, low-cost, mid-tier silver producer focused in the Americas. Mr. McEwen's investment in the combined company (market close on June 13, 2011) would be approximately US$ 345 million. CONTINUES HERE
And the cherry on the cake? If (when) this deal goes through, the newly fused company gets to be called "McEwen Mining Inc", which caused me to wipe coffee off my nice new computer screen this morning.
If I were a long time supporter and holder of MAI.to I'd be hopping mad today. Because of McEwen's desire to "do something" and "take initiative" and "be innovative", MAI.to holders are faced with the future of seeing their valuable producing asset at San José, very good looking prospects around the area and the spin-out bonus of Los Azules be diluted to kingdom come by the pisspoor track record of gold exploration at US Gold (UXG), which to date has only found one decent silver prospect (the gold assets currently at UXG ain't never gonna happen) at El Gallo Mexico (i.e. for "US Gold" please read "Mexico Silver") that's already valued up to the hilt. Sadly for MAI.to longs, it's going to be very difficult to stop McEwen from applying the KY Jelly because as he owns 31% of shares and will be able to mesmerize enough of his faithful flock into believing this deal is good for them and not just his own ego the majority vote will be easy for him to reach.
0.4 shares of UXG is an insult! ForCryinOutLoud, HOC.L could offer a better deal than this. In fact, thinking about it, that might just happen....