Quote:
Originally Posted by suzuka84
Main reason: in the current environment, there would be massive uproar if your company sold off its gold streams to NOT take advantage of the current spot price. All the gold companies have paid big termination agreements to cancel their forward gold hedges.
You wouldn't be able to build another Silver Wheaton today. Many factors were in play that made Silver Wheaton into a home run, one of the biggest being Goldcorp packaged it up and spun it out at a time when silver was low. At that point in time, miners were anxious to sell our their non-core streams for upfront payment. As silver prices went through the roof, Silver Wheaton had many silver producing assets that allowed it to ride the wave. Silver Wheaton also owned the silver producing mines.
Gold Wheaton tried to mimic Silver Wheaton's business model but in the current economy where metal prices are high. If you had a mine, why would you want to sell off your gold streams? you wouldn't need to and as such Gold Wheaton relied on rainmakers to put deals together and even then it didn't have the capacity to be taken serious. You'll see Gold Wheaton went through a round of share consolidation and dillution to try to make the model work and in the end they had to combine the business with another company to gain size to give it another shot.
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So why did you get Gold Wheaton then? Just to get some FNV?