I have been about wondering all the posible factors that might have been involved in the decisions of the insider selling.
This might be way off the mark but has anyone else wondered if all the great corporate support (wonderfully documented by Safeharbour) that ARU has shown to the local community and the government, that perhaps there were some rumblings in the government talks about what might happen if the company were to be sold. What if during the talks in January the government expressed a view that they would be "in favour" of dealing with Patrick and his team, and less in favour of a new unkown owner? It could mean that ARU would have to develop the mine themselves or go for a joint venture.
I always try to put myself in the other guy's shoes and ask what are his needs and priorities? Priority #1 it seems to me, is to get the ball rolling and develop some actual mines that will generate tax revenue and employment that I can point to and say: "See? This is only the beginning." After a year in power there's enormous pressure on this govt. to show results, plus there's an election coming up, which also enters into the equation. A few ribbon cutting ceremonies would go a long way to firm up public support.
If Aurelian develops the mine itself, it is going to take longer. They will have to complete a bankable study, drum up financing, order equipment, hire personnel and so forth, which will take at least another year. OTOH, a large outfit could roll in and get things started much sooner using existing lines of credit and equipment they already own.
The community work aspect falls out of the equation IMO. That's what all smart explorers do, and it comes out of the operating budget since there's no income to write it off against. Continuation of these programs can be part of the buy-out negotiations, which the govt. would no doubt have a hand in, or they can be earmarked from tax revenue and distributed to local govt. which is the politically smart thing to do. In either case the programs would continue, so I don't think that's the main issue.
Another consideration is the need for roads, power and other infrastructure, which the govt. will have to pony up for. With a large operator, they can pass more of those costs on to them, since they have deeper pockets. Remember, this is a future mining district, not just one project. As Minister of Mines, I'd have to be thinking along these lines and looking further down the road than just "how do we accomodate this one little company?" There are economies of scale involved, which are easier to address if you have one or two large operators who can manage an entire district. This cuts both ways, as a larger outfit will have its own economies of scale, and can operate on lower margins than a bunch of small companies with less financing and greater start-up costs.
The best of both worlds scenario, and the one that satisfies local interests (which may have a more emotional, less practical outlook) would be the Virginia scenario, where Aurelian stays on as explorer, and the acquirer has first option on anything they find. I'm guessing this is how it will play out, as opposed to my earlier theory of a big outfit like CVRD taking over the whole project, since the big guys seem to have their priorities focused elsewhere at the moment (although I wouldn't rule it out as a later development once the district is clearly established)
Those are just my thoughts. I'm no expert, just a guy trying to figure things out. By the same token, I'd also be selling a few shares if I were an insider with a huge stake. Nothing is ever guaranteed, and these guys can't have missed what happened to Nova. After all the work they've put in, I'd want to protect myself against any contingency, no matter how remote, especially since we're in the final stretch which is often where things go astray.
ebear
