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Bacanora Lithi. Share Chat (BCN)



Share Price: 21.50Bid: 21.00Ask: 22.00Change: 0.00 (0.00%)No Movement on Bacanora Lithi.
Spread: 1.00Spread as %: 4.76%Open: 21.75High: 0.00Low: 0.00Yesterday’s Close: 21.50


Share Discussion for Bacanora Lithi.


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Sid_fiddler69
Posts: 3,187
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Today 21:38
Stop inhaling ,waccybaccy!
 
share_talk
Posts: 5,434
Opinion:No Opinion
Price:21.50
Weekly Stock Market News
Today 20:42
jam2morrow
Posts: 43
Opinion:No Opinion
Price:21.50
lithium Ce/Fl/Oh
Today 18:28
as Sid cryptically points out there are at least 3 different lithium products that can be used in batteries. Lithium Chloride as well, i think. Check out the EMH board, they will tell you hydroxide is the way to go . At the moment a lot of Li carbonate is derived from spodumene mined in Australia and that goes into the chinese market. The geology dictates to a great extent which end product is made but there are still decisions to be made for the processing route. There will be a market for both Zinwald and Sonora Lithium, the most important thing, by far, is the finance
Sid_fiddler69
Posts: 3,187
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Today 17:23
blimey??? Cinovec/Zinnwald , Lithium Hydroxide or???
waccybaccy
Posts: 128
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Today 15:49
Endion, I think you (and others I've seen posting) need to realise that not all mined lithium is the same. I used to think that Sonora was the same as Zinnwald but they are very different.

Zinnwald = Zinnwaldite = LiF. Think back to chemistry GCSE. Lithium and fluorium are 2 of the most reactive elements and take massive amount of power to convert to raw lithium. Hence Zinnwald's "lithium" can only be used for optics, polymer LEDs, nuclear reactors (thanks wikipedia). i.e. definitely not batteries. However it does have a higher selling price than lithium carbonate. I have not heard of any increasing market for this although there are more LEDs nowadays so who knows.

Sonora = lithium carbonate and this _is_ the stuff of car batteries. The market looks like it will go mental fairly soon.

Disclaimer: all IMO and DYOR!
share_talk
Posts: 5,434
Opinion:No Opinion
Price:21.50
Weekly Mining Highlights
Today 15:22
Endion
Posts: 2,621
Premium Chat Member
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Today 08:37
Yea Id noticed that. And Sonora seems to have a fairly uncommon soft ore which the company says makes it quick and productive in terms of extraction compared to brine deposits.

Its a shame that its fixed at €30m. Increasing ownership of the asset to 100% would be incredibly beneficial long term, especially if market outlooks for lithium prove correct. Maybe whoever owns the other 50% after the default would offer it back on more preferable terms?
jam2morrow
Posts: 43
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Sat 22:25
Yes fixed at 30M. I think we bought our half for 5M with the promise to spend another 5M on the feasibility study. If/when we default on our option then solarworld can have it for peppercorn 1E; but since solarworld are now bust I assume that right goes to their creditors (don't quote me on that last bit though).
Although Zinwald and Sonora are both Lithium mines they are very different and will produce a different product: Lithium Carbonate and Lithium Flouride which will go into different markets. That is the reasoning behind the spi-off plan
Ivybush
Posts: 399
Opinion:No Opinion
Price:21.50
RE: Cadence selling
Sat 22:21
@garyn and I am guessing you are aware that a strategic shareholding can sometimes
command a premium to market value. Just hypothetical like your comment.
garyn
Posts: 37,295
Opinion:No Opinion
Price:21.50
RE: Cadence selling
Sat 22:12
I’m guessing you are aware that less than 5% of shares in issue in that company have been traded in total during 2019 so far - so how would it realise the paper value of that holding at the current share price?
Endion
Posts: 2,621
Premium Chat Member
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Sat 22:10
Thank you for your response Jam.

I had assumed the £1.30 buyout reference was put in when it was higher, id have to go back and check, but they kept it in and the same even at these prices.

Is the option to buy the other 50% stuck at €30m irrelevant of current fair value? Seems like a pretty harsh deal.
garyn
Posts: 37,295
Opinion:No Opinion
Price:21.50
RE: Cadence selling
Sat 22:00
It is skint enough that it has had to sell shares, hence why it has offloaded BCN. It’s EMH holding might be worth that much on paper but doesn’t mean it can sell it for that amount - assuming it wanted to sell. Would need an awful lot of liquidity there in order not to cause a similar drop to that which we have seen on BCN as it started to sell.
jam2morrow
Posts: 43
Opinion:No Opinion
Price:21.50
RE: A few points. Post 2 of 2
Sat 21:59
Endion, the exercise prices look good from the price we are now but this share was around 80p for ages and never seemed to move that's why they now seem a little OTT. I think that 130p clause was put in just before we got wind of the Next View finance package so there may have been some rumours of an approach at that time. When I first invested here part of the reason was because of director buys, all around 80p.
The Zinwald option is interesting. I thought it was a bit cheeky including it as an asset because to my mind we won't exercise the option. The option to buy the other half expires in Q3 but it is for 30M euros . We pay 30M euros to gain an asset valued at $150k? don't think so. Or is it we pay 30 to get an asset worth 30.15? It will be interesting to see who gains control of the other half, but I assume it will revert to solarworlds creditors and then be sold on(for less than 30M EUR).
The plan is to spin off Zinwald into its own company. I don't think anything will happen until the option has expired though.
Don't know if I've helped much, I'm afraid a good part of my strategy is gut feeling. Everything depends on finance. We have the asset, but without the finance it stays in the ground. Just recently we've had the buyout whispers as well. All in all, a good time to get in. GL
Ivybush
Posts: 399
Opinion:No Opinion
Price:21.50
RE: Cadence selling
Sat 21:54
@ garyn I fear you did not look close enough at kdnc last accounts.

Among other quoted investment holdings kdnc have 19.2% of European Metals [emh]
Present mcap £25.6m x 19.2% = £4.9million Not skint then after all!
garyn
Posts: 37,295
Opinion:No Opinion
Price:21.50
Cadence selling
Sat 16:48
Having had a look at that company it is clear that it is skint - loan became payable on Jan 1 with monthly payments of $450k to $500k! Most of its saleable asset value in the last accounts there was based on BCN shares when they traded at around 87p, so does explain why it was seemingly dumping its almost 7% holding at almost whatever price it could get!
Endion
Posts: 2,621
Premium Chat Member
Opinion:No Opinion
Price:21.50
A few points. Post 2 of 2
Sat 16:44
4. "The option to purchase the remaining 50% interest has been recognised as a derivative asset in the Consolidated Statement of Financial Position as it represents the option to acquire equity instruments at a future point in time. This derivative asset has been recorded at its fair value of US$152,898 (30 June 2018 - US$615,011), categorised within the level 3 fair value hierarchy. The derivative asset has been classified as short-term due to its realisation being in Q3 2019. The fair value was determined using the Black-Scholes option pricing model with the following inputs."

Two points here. In regards to Deutsche Lithium, the value seems to have the potential to increase considerably. It also states here that its "realisation" will be Q3 2019. What does this mean? Does this mean that they intend to buy out the remaining 50% in Q3 2019, or is this something else?

5. "the inclusion of a cash payment representing an acceleration of unvested options in the event of a change of control of the Company at an acquisition price of at least 130 pence per Bacanora share. Such cash payment will be calculated on the basis of the difference between the acquisition price per Bacanora share and 102 pence (being the middle market price of a Bacanora share at close of business in London on 17 November 2017),"

In regards to the "Change of control" terms. It seems they have put in place provisions for management to be compensated should the company be bought out at a price above £1.30. It is interesting that they should include such a thing.
Endion
Posts: 2,621
Premium Chat Member
Opinion:No Opinion
Price:21.50
A few points. Post 1 of 2
Sat 16:44
I've been slowly combing through the reports and info available on this company and have come across a few things that i would like to share. Many of you will likely have found this info already, of so then your opinions would be very welcome. These few points are from the interim results published 13 Feb 2019.

1. "On 19 July 2018, the Company elected not to proceed with its proposed placing to raise gross proceeds of US$100 million due to volatility in global commodities markets. In 2018 there was significant negative market sentiment due to falling spot prices and concerns around supply and demand fundamentals (see Market Review). The placement was postponed in order to await improved market sentiment. On 27 November 2018, Bacanora appointed Citi to lead the equity financing of the Sonora Lithium Project alongside Canaccord, both of whom also act as joint corporate brokers in order to fulfil the remaining funding requirements for phase 1 of the project."

According to this statement the placement was postponed due to the market sentiment at the time. Given current and future outlook for lithium and EV in particular, market sentiment should work in the companies favour going forward. It doesnt however take the possibility of a placement off the table.

2. "Second bond: US$56 million nominal amount zero interest-bearing secured notes issued at a purchase price of US$12 million with a 20-year term. The nominal amount is repayable by reference to monthly production of lithium at a rate of US$160 per tonne of lithium produced, with any remaining amount repayable at the end of the 20-year term."

Regarding the second RK Mine bond. Whilst fairly negligable, this deduction should be considered when calculating revenue per tonne etc.

3. "Furthermore, the Company granted 6 million warrants to RK Mine Finance, exercisable over five years at a 20% premium to the 20-day VWAP, the exercise price has been fixed at 0.9945 GBP, subject to normal anti-dilution provisions, cash settlement at the Company's option, and cashless exercise at either party's option."

Doea this mean that RK Mine can only exercise their warrants once the share price is 0.9945GBP? If so, this is very good for those who have an entry point below this.
Northseatiger1
Posts: 158
Opinion:No Opinion
Price:21.50
RE: Posts ?
Sat 15:23
Just awaiting news. It's the weekend so enjoying it and back here again Monday.
EyeGuy
Posts: 16,280
Opinion:No Opinion
Price:21.50
RE: Posts ?
Sat 15:18
still watching and adding personally
mytton
Posts: 391
Opinion:No Opinion
Price:21.50
RE: Posts ?
Sat 15:14
just waiting for next news to drop - SCopper /Chinese/ funding
Spadger42
Posts: 861
Opinion:No Opinion
Price:21.50
Posts ?
Sat 15:11
No posts since Friday ???
Rocket79
Posts: 2,278
Opinion:Strong Buy
Price:21.50
Buy rec
Fri 16:54
Analysts at VSA Capital have a ‘buy’ rating and 115p per share price target on Bacanora Lithium shares, well above the current level of 21.75p.

In a note focused on the Zinnwald license extension, the VSA analysts said, based on the previously defined resource, they have attributed a value of £38mln for the project, using a peer-based EV/resource metric, implying 10p per share.

They said that given the proximity of the German licenses and the reported geological similarity, given historic workings for tin, tungsten and lithium across both areas, in their view there is potential for an extension of mine life to that defined in the feasibility study..

The analysts pointed out that Bacanora is planning to produce a lithium fluoride product at Zinnwald, which is one of the most valuable lithium products with recent pricing indicated at around US$22,000 per tonne and could be used by the local German chemical industry.

The VSA analysts also noted Bacanora’s comments on recent share price volatility and the changes to its register prompted by investment strategy revisions at Blackrock and Capital Group.

They said: “With this technical selling now indicated to be complete we expect stronger support for the stock ahead from a trading perspective.”

Overall, the VSA analysts think the fundamentals for Bacanora remain unchanged with Sonora remaining a highly attractive asset which is, in their view, “deeply undervalued”.
Dicko123
Posts: 212
Premium Chat Member
Opinion:No Opinion
Price:21.50
SP
Fri 15:13
live twenty one V twenty one point three
TaffEvans
Posts: 6,552
Opinion:Strong Buy
Price:21.50
RE: Bacanora has just tweeted
Fri 15:07
Can't They will be in a closed period
L2analyst
Posts: 1,188
Opinion:No Opinion
Price:21.00
RE: Bacanora has just tweeted
Fri 14:52
I want them to buy some more shares! Not bloody tweet!




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