Racism in America
Irving Resources, etc.
In today’s America, while everyone is allowed to be proud of his religion, race, and the hellholes he or his parents left behind, there is one group of people who are expected to feel guilty about their race. These are people of European origin, exactly the people who are the reason behind the grand success of America, and for much of the intellectual capital of humanity. They are made to feel guilty because they, apart from East Asians, are the only people who have the potential to feel guilt and shame. I explore this issue in the linked article.
Irving Resources (IRV) has been volatile because the market was expecting much more from their news release. IRV as a company continues to grow, with now 50 people working in it compared to 20 a mere two months back. It is now operating at all the three major areas at Omu project: drilling at Omu Sinter, trenching at Omui Mine for bulk sampling and to identify drill targets, and sampling at Hokuryu for identifying drilling targets.
The drill results from Omu Sinter did not excite the market. It will likely take a fair bit of work to understand the structure of the system. I have no reason to be pessimistic based on the first set of drilling from an area that was never drilled or even looked at before.
There is another reason the market might have been worried. Over the last few days, a couple of insiders have sold a small number of their shares. This was just enough to raise the necessary cash to exercise their warrants that expire soon, and to pay a rather large amount of withholding tax on them—Canadian resident insiders are required to pay a withholding tax on exercised options/warrants even if they are not sold.
IRV insiders own a large number of shares and have rarely sold. (Everyone should read Management Information Report on every company he invests in. Check out the low-salaries of IRV insiders and their ownership in IRV on page-7 here).
I mentioned IRV as one of my tenbaggers two years back. It is one of my largest positions. Any drop to its recent low will make me buy more.
My conflict of interest: In small ways (certainly small compared to my ownership of IRV), I have on and off done some consulting work for IRV, and was a Director in Gold Canyon, from which IRV was spun out.
On other matters…
On July 31, 2019, we wrote about two arbitrage opportunities: Allergan (AGN.NYSE; US$158) and Mellanox (MLNX.NYSE; US$107). We made an error… The merger transaction of AGN is expected to close in August 2020, not in 2019. MLNX’s is expected to close by the end of 2019.
The current upside in owning AGN is 12%. The upside in owning MLNX is 16%. We must, however, look at annualized upsides to take a good decision. And this should be only for the cash component of the transaction for AGN. On this basis, AGN offers a 20% upside, and MLNX offers a whopping 57%. Of course, a lot can go wrong, particularly given the trade-war and the hindrances China can create, but we are happy to bet on MLNX for now. We have certainly found such companies as good “moats”—as Buffet would call them.
Finally, I have written several times about FPX Nickel (FPX; C$0.145). FPX is doing a private placement at C$0.15. Given that it is one of my largest positions, I am not participating. But I must express my respect for the management in how they are going about raising money. Since I started following them, they have raised money at a higher price every time. They issue no warrants. And now they are raising money at a price higher than the market price. What FPX is doing is how money should ideally be raised by a company.
Associate: Rajni Bala
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