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Valuation is a problem – Marc Watchorn, Wits Gold CEO
In an interview on Radio 2000 @ 18:00 on Monday, 24 April 2006
[miningmx.com] -- WITS Gold, the exploration firm that listed in Johannesburg on April 24, conceded that accurately valuing the company was problematic.
“One of the problems with an exploration stock is valuation. With a mining company you know how much gold is in the ground. But if you buy an exploration stock you’re buying optionality not functionality,” said Marc Watchorn, CEO of Wits Gold.
Watchorn was speaking on the week nightly business show, The Moneyweb Power Hour, broadcast on Radio 2000.
Wits Gold was widely expected to debut on the JSE at about R20/share. Instead, there was a shock opening bid of R60/share when trade commenced.
The share then shed up to 22.5% in intraday trade, but in a highly volatile day regained some ground to end 11% lower than its open.
The market currently values Wits Gold, which owns properties containing an estimated 142
million oz of gold in the resource category, at about R1.25bn.
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