I own Rusoro and Gold Reserve. More disclosure. Even more disclosure.
March 10, 2025
Last month I mentioned my Rusoro (RMLFF) long position. Since then Gold Reserve (GDRZF) announced the Dalinar Energy bid for Citgo. An investment from Koch, one of the largest private companies in the US, gives is credibility. Is this bid good for Gold Reserve? Maybe. It is better than their not getting anything in the claimant waterfall. It is worse than their getting paid in full in cash. Is this bid good for Rusoro? Definitely. Gold Reserve is bidding to get covered, which means that Rusoro would get covered too. This is corroborative of the thesis that Rusoro is a 2-3x return in a year from where it traded last month.
June 3, 2025
Gold Reserve Announces US$7.382 Billion Citgo Bid Recommendation
Decision represents a Significant Milestone in 15-year legal journey
Gold Reserve Ltd. (TSX.V: GRZ) (OTCQX: GDRZF) announced today that its U.S. acquisition subsidiary, Dalinar Energy Corporation, is the Final Recommended Bidder for the purchase of shares of PDV Holding, Inc., the indirect parent company of CITGO Petroleum Corp.
The selection of the U.S.-based Dalinar was made public today in the Notice of Final Recommendation filed by the Special Master appointed by the U.S. District Court for the District of Delaware, which is overseeing the sale process. This represents a significant milestone in Gold Reserve’s nearly 15-year legal journey. A copy of the Special Master’s Final Recommendation and supporting materials, including Dalinar’s bid materials, can be found here.
For further information regarding Dalinar, visit: https://www.dalinarenergy.com.
“We are thankful for all of the efforts of the Special Master and his advisors to reach today’s final US$7.382 billion bid recommendation. We believe the recommendation acknowledges the strength of Dalinar’s bid,” said Paul Rivett, Gold Reserve’s Executive Vice Chairman. Mr. Rivett continued, “Our bid satisfies creditors further down the waterfall than was ever contemplated by any prior bid since the inception of the Delaware sale process. Gold Reserve is thankful to our consortium partners, financial counterparties, and other stakeholders who steadfastly supported us through the years and made today’s bid recommendation possible. Above all, we are very grateful to the team members that worked tirelessly to achieve this outcome, and to Gold Reserve’s supportive shareholders who kept the faith and believed in us through tough times, some for many thankless decades. We look forward to the Court’s decision in August and getting closer to finally closing this chapter in Gold Reserve’s long history.”
Dalinar’s bid is supported by a consortium that includes judgment creditors Rusoro Mining Ltd., Koch Minerals Sarl and Koch Nitrogen International Sarl, and Siemens Energy, Inc. The bid’s stated net purchase price is US$7.382 billion1, significantly higher than the US$3.7 billion stalking horse bid submitted by Red Tree Investments earlier this year.
At closing, Gold Reserve will own approximately 44% of Dalinar’s common equity, representing 85% of the voting shares.2 In addition, Gold Reserve will hold at least $150 million of $1.5 billion of preferred equity securities in Dalinar or one of its subsidiaries.
Dalinar’s US$7.382 billion bid benefits several parties by satisfying in full, in cash, or non-cash consideration, Gold Reserve’s attached judgment, the attached judgments of all creditors senior to Gold Reserve in the court-approved priority waterfall, and the attached judgment of junior creditor Siemens Energy, Inc.
The Dalinar bid includes a combination of equity and debt financing. A consortium of lenders, led by J.P. Morgan and TD Bank and including Sumitomo Mitsui Banking Corporation (SMBC), have provided commitments for the full amount of the anticipated debt financing.
“We would like to specifically acknowledge the overwhelming effort and belief in this bid demonstrated by Meghann Altman and Keith Canton at J.P. Morgan from the outset of our submissions last year, and more recently, John Prato at TD Bank, who worked to bolster our financing at a crucial time this year that allowed us to remain competitive”, said Paul Rivett. “All financial institutions are not equal and in the end it is the people in those institutions that provide for greatness at crucial times.”
The Delaware Court is scheduled to hold a Sale Hearing on August 18, 2025.