Scion Capital Encouraged by Proxy Voting Against Gold Fields Acquisition of Bolivar
January 10 2006 - 4:24PM
PR Newswire (US)
Largest Shareholder Recommends 'Sending a Message' to the Board
CUPERTINO, Calif., Jan. 10 /PRNewswire/ -- Scion Capital, LLC said
today it is encouraged by the proxies it has received in support of
its efforts to prevent the undervalued offer for Bolivar Gold Corp.
(TSX: BGC) by Gold Fields Limited (NYSE:GFI). "Based on the proxies
received up to today, we have received substantial support from
securityholders, although the final vote won't be known until both
our proxies and those received by management are counted," said
Michael Burry, Scion Capital's President. "We want every voice to
be heard and recommend that all Bolivar securityholders take this
opportunity to send a message to their Board that the Gold Fields
$3.00 per share offer is inadequate and undervalued. This is
especially true in the current environment as gold prices continue
to rise." Scion Capital reminds its fellow Bolivar Gold
securityholders that: -- The Gold Fields offer does not provide
fair value for the assets and potential of Bolivar even under the
market conditions at the time it was announced. -- The Gold Fields
offer does not reflect that the price of gold has increased by over
11.5%, recently hitting almost US$550 per ounce, since the offer
was announced. Comparable companies have seen their share prices
increase by as much as 100% over that period while Bolivar stock
has been effectively locked below $3.00 per share as a result of
the Gold Fields offer. -- Bolivar Gold's Board and management have
vastly overstated the degree of political risk to its operations in
Venezuela. This was confirmed by a Dow Jones report on January 6
that "those companies that received permits, including Canada's
Gold Reserve Inc. (GRZ) and Bolivar Gold Corp. (BGC.T), are
examples of viable projects that are in tune with the state's new
mining policies." The report included a statement from the
Venezuelan Mining Minister that "All those who follow the country's
laws have nothing to worry about." Shares of Gold Reserve have
increased by more than 22% since the report while the Gold Fields
offer has kept Bolivar's share price flat. -- If the deal is
approved, Bolivar shareholders will be receiving $3.00 per share,
while senior management at Bolivar will receive over $29 million in
addition to any Bolivar shares or warrants they hold. Scion Capital
continues to question these excessive golden parachute payments in
light of the fact that senior management has already taken similar
positions in their next venture, Coalcorp, and are actively
involved with several other start-up entities. "The Gold Fields
offer was opportunistic, undervalued and inadequate," Dr. Burry
said. "There is much more value in Bolivar than the offer
represents. Bolivar's management and Board are not looking out for
the best interests of securityholders. In order to protect their
interests, securityholders should tender their Pink or Grey proxy
cards against the deal today, the last day that votes can be
submitted. Securityholders can still vote against the deal even if
they have already submitted a proxy card in favor of the
transaction, as any proxy received today will supersede earlier
submissions." About Scion Capital Based in Cupertino, California,
Scion Capital, LLC is an investment advisory firm founded in 2000,
with current assets under management in excess US$750 million.
Scion Capital seeks to make long-term investments in companies it
identifies as having value that has not yet been recognized by the
market. It employs a value oriented investment strategy across many
public and private industries, markets and investment
opportunities. Scion Capital is Bolivar's largest shareholder with
holdings of 21,676,400 shares representing approximately 19.14% of
Bolivar's outstanding common shares. Scion Capital's Dissident
Circular is available at http://www.sedar.com/ and at
http://www.scioncapital.com/. DATASOURCE: Scion Capital, LLC
CONTACT: media, John Lute of Lute & Company, +1-416-929-5883,
for Scion Capital, LLC; or investors, Steven A. Druskin, Chief
Legal Officer of Scion Capital, LLC, +1-408-441-8400; or Mackenzie
Partners Inc., 800-322-2885 (toll-free), or +1-212-929-5500
(collect) Web site: http://www.scioncapital.com/
http://www.sedar.com/
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