Alamos Gold made a friendly offer to purchase Esperanza Resources for a 38% premium. The trend continues, and these terrible deals will continue until shareholders vote no. The stock was trading at $2.25 in 2011, so they are not paying a premium at .90 cents. In fact, they are paying a huge discount to the true valuation.
Alamos Gold is paying $70 million for 100,000 oz mine, plus the exploration potential of Esperanza’s properties. This is a great deal for Alamos, but awful for Esperanza shareholders (many of whom likely lost money). If Esperanza would have built Cerro Jumil (1.5 million oz .8 gpt) this stock would have been at least a 10 bagger. And with Esperanza's pipeline, this could have been a 20 bagger long term. I never purchased the stock, but I feel for their shareholders. I have experienced this myself several times.
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