You lot not have lives then? No? All this wibbling on a Friday night when you should be out having a life? No pockets in a shroud you know. ;-)
Numbers. there are essentially only 2. One effects the other. First:
What the market will value this at (it's Mcap) as a financed and being built mine (a few months hence)? I think that centres around £2.2bn (I'm sure others will have their own thinking). £2.2bn is about 37% (mid way between 25 and 50) of the construction start NPV which is the project DFS basis, defining a 10mt/y nameplate mine .It is also about 19% of the NPV of an expanded mine to a 20mt nameplate capacity.
You can get an sp estimate from that if you also know the total share issue then. That comes to the second number:
As part of this $1.09bn Stage 1 financing the co have flagged an expectation of around £410m for the cash raise from the new issue equity component of it. If that issue goes at today's 45p that would take the total in issue to ~3.2bn. So an sp from the later £2.2bn Mcap est comes out at 68p. From that is it reasonable that the issue should go at 45p? A 34% discount to 68p?
The first number - £2.2bn - is just my guess and is an unknown. What matters is that this is to a large degree also unknown to those who are deciding whether to take this new issue or not. They may or may not want to hold what they take I would think some will and some won't, but regardless the co has to get all this issue taken - and convince the Structured Capital provider of this to get that part of the deal. So the above level of discount may well have to happen. But conversely may also have room to reduce. Some room.
From that you know where I'm going as regards whether this sp today now fully prices in successful financing and also prices in a new issue price around this present price, or whether is does not yet and there is further to go.
'Ave a guess. The co's priority is to get the deal.....above all else.
Agreed. Good post, Niloc. In one respect at least I really hope we don't see anything like the last two weeks. "Are you CRAZY, rocal ?!?" Wait a sec. I don't mean anything to do with the share. What I mean is that, over these last two weeks we've just about all of us experienced a 100% increase in our initial stake. Some have experienced two, perhaps three hundred percent. It's even feasible that a lucky, no, savvy, few have actually experienced over a THOUSAND, maybe two thousand, percent increase.....So why the Donald Duck has this been the worst week probably that anyone on here can remember for backbiting, abuse, general falling out, on a board that used to always be a terrific place to be in comparison to some of the other boards we visit? It's no good saying stuff like "Those trolls, they are shorting scum", "This share is set to tank, you fools", and so on. They are, at the going down of the sun, just people with a totally opposite viewpoint to us about this share. They are to be argued with, if you choose, or they are to be ignored but for God's sakes let's not turn this great site into what some sites on LSE have become: nothing more than an exchange of mutual insults about people's intelligence, motives, sad lifestyle, parentage even. I could point you to share sites where just about every single contributor is a monomanic, self indulgent lunatic; please let's not even start to turn this great site into anything remotely like that. Rant over! :-) Hope everyone's having a fantastic Bank Holiday, made even better by just an occasional glimpse at their portfolio! rocal
Hi niloc1. Fair comment imo. if it wasn't for all the excellent posts on this bb over the past 2 to 3 years I'm not sure that I would have invested as much as I have in sxx or have held on for so long throughout all the ups and downs. .. carry on
It's going to be an exciting week ahead. Wish I had a crystal ball. Will we get any news this week on finance? Will we get back into the 50s in anticipation of news? I suspect a fair few got stung during the week due to stop losses and panic selling so many of those that helped it to 52p is so last week won't be getting back in again to help it up. Hopefully some others arrive in instead to drive it up. The big question is after we get the full news does this either spike or rerate to a higher level or is it's true value (for a while anyway) around the mid 40's. I don't think it is myself as obviously the financing risk must be holding it back to some extent. Plus if scotty Gonzalez says this may hit 55 next that is a good sign if those shorting think it will hit that next.
Anyway, good luck all and don't put on any stop losses unless you have reasoned out to yourself how you would feel if the price dramatically dropped and your loss is realised (it hurts) whereas your plan would have actually been to ride it out long term.
One Other thing while I'm rambling. It would be great if this week people really try to use this board to help each other out. We can actually do this without shooting ourselves in the foot as we all want the same thing - to make money. Most of us are pulling in the same direction (except for shorters) so why not actually try to help each other out. We have all seen how useful it has been having lgv giving us L2 insight and GK making some reasoned calculations/predictions so let's have more of that and less of the picking numbers out of the sky in the hope saying it will make it happen and less of the schoolyard name calling. Cheers
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