Core Viewpoint - The acquisition of Xinjiang Meisheng Mining Co., Ltd. by Western Gold at a significant premium of 1421.66% raises concerns about the sustainability of the company's profitability and the potential risks of overpaying in a high gold price environment [2][4]. Group 1: Acquisition Details - Western Gold announced plans to acquire 100% of Xinjiang Meisheng for 1.655 billion yuan, compared to the company's net asset value of 109 million yuan, resulting in a premium of 1421.66% [2][3]. - Xinjiang Meisheng has been operating at a loss, with net profits of approximately -35.94 million yuan in 2024 and -14.16 million yuan in Q1 of this year [3][4]. - The core asset of Xinjiang Meisheng is the Kataba Asu gold-copper mine, which has a proven ore reserve of 25.67 million tons, containing 78.7 tons of gold [3][5]. Group 2: Industry Context - The 14-fold premium is considered unusual in the mining industry, where typical acquisition premiums range from 40% to 90% [4][5]. - The recent increase in the asset's value by nearly 50% over the past year raises questions about the valuation methods used for the acquisition [5][6]. - Western Gold's current mining operations are limited, with two of its owned gold mines in a state of suspension, highlighting the urgency for new resource acquisitions [7]. Group 3: Financial Strategy - Western Gold plans to issue up to 1 billion yuan in medium-term notes and 1 billion yuan in corporate bonds to fund various financial needs, including debt repayment and project construction [8].