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Not encouraging trading (ask 2.5675p and bid 2.4020p)
Van I was going to post a reply to you on ADVFN, as I am also on there. Just too much noise there at the moment. I doubt if they will get something basic as that wrong, and no doubt will be already getting the relevant resolutions ready for the AGM. Simply too many advisors involved in the merger and annual accounts audit to get it wrong.
Please feel free to post it on ADVFN.
Master G - By my reckoning the authority will need to be increased to issue all the shares, required for the merger.
Interesting. Thanks. Could I post that on ADVFN? Somehow someone will need to make sure the Nomad is on top of this or a voting error could be made, which I guess might make the transaction null & void?
What are people’s thoughts on share consolidation?
I’m sure doing that when we enter onto the ASX sends the right signals out.
Stranger, Van
Stranger has already referred to AAU articles of Association, which gives guidance to follow.
If you are further interested in the type of resolution required for the authority to issue additional shares. You need not look much further than the resolutions passed on 29 June 2023, filed at companies house. (Filed 14 July 2023). Board authority to allot new shares is under section 560 of the CA 2006. This is the authority for resolution 7, authorising maximum number of new shares to the value of £500,000 nominal value with a split between new and existing holders of £250,000 nominal each maximum.
Resolution 8 is waiver of pre-emption rights which requires a special resolution under section 561(1) under CA 2006.
Resolution 9 is the authority for the company to purchase its own shares under section 693 CA 2006.
Special resolution has to be approved by 75% of those voting.
The authority usually lasts from one AGM to the next and requires renewal at the next AGM.
By my reckoning the authority will need to be increased to issue all the shares, required for the merger.
The information is in the public domain for you to search and gain insight.
At this moment in time, I am in favour of the merger and will vote accordingly.
We all have a decision to make based on our own particular circumstances, our aversion to risk and timelines.
Van I do follow what you post on AAU on the other BB.
Stranger your rare posts usually make lot of sense.
DYOR
Stranger, Van
Sunday Ariana catch up. Over the years I shudder to think how may hours I have spent, at least I know what my Mastermind specialist subject would be.
Some great posts. I feel at sea here, in November 2019 I was black and white about the Ozaltin deal. Put simply I thought it was the work of the devil, bit like peanuts. Not only the loss of interest in the assets (which, as has been proved by the financing method employed at Tavsan, could now provide a c.300k ounce split 50:50 between just ourselves and Proccea) but also loss of control in the Turkish operations. Basically Ozaltin will take the cash and can tell AAU to bugger off if it gets vocal. All that was achieved was some special divis which many of us reinvested at a SP higher than now and consequently benefitted relatively little.
This is different. IF (capitals intended) all goes well Dokwe appears to be a steal. There appears to be reasons why the owners want to sell, they know Sener from the past, they will retain a strong voice if not control in the future of their asset even if taking more of a back seat. Their 36% (or whatever) may mean they address some of the inadequacies of the current board not only in Zimbabwe but the wider AAU portfolio.
Like Stranger I dont think 'new' AAU will go it alone and hope there is a SEPARATE JV set up which avoids loss of control and will de risk. The problem is risk. This asset, if it turned turtle on AAU, could sink the company. Equally it could increase the net assets per share of AAU dramatically, despite the dilution. Its a big project, appears to be open pit, and far more advanced towards production than the jam next decade (or the one after) that Salinbas has become. As for Cyprus don't start me. You wont like me when I'm angry, my shirt falls off and I turn green.
Have a good day all. Commiserations to C&B and LoB for Burnleys predicament!
From Ariana's articles
Subject to the provisions of the Acts and to the authority of the Company in general
meeting required by the Acts, the Board may offer, allot (with or without a right of
renunciation), issue or grant options over or otherwise deal with or dispose of shares in
the Company to such persons, at such time, for such consideration and generally on
such terms and conditions as the Board may determine.
So a general meeting resolution is all that is required.
Stranger,
That is an excellent summation and I agree this merger is great for Ariana, and this is needed as the S/P has languished for an eternity.
John - Just google - Does a Listed public Co in the UK need a Special Resolution to issue more shares?? or similar
This is the sort of response you will get.
"You generally need a resolution to issue new shares in a UK company. The Companies Act 2006 requires private companies to pass an ordinary resolution, while public companies need to pass a special resolution."
The presentation was interesting and although MdV was not very forthcoming KS did open up quite a bit. KS seems to believe that this will take Ariana to the next level.
How much is Dokwe worth?
Dokwe North has 1.2 million oz gold reserves which will be mined using open cast. The current projection is to mine 100,000 oz for 10 years which should give about $1,000 million of future profit. The mine will be opencast and relatively inexpensive to mine. The stripping ratio is about 6:1 which is 2.5 times less than the overburden at Kiziltepe. This is the profit that Ariana would receive if it developed the mine by itself, however I think that it might develop the mine as a JV and thus the profit would be lower. If there is a JV then Ariana needs to drive a harder bargain than it did with Ozaltin regarding Zenit.
Dokwe Central has had minimal exploration drilling but is currently showing a resource of 80,000 oz. There needs to be significant further exploration of Dokwe central.
At the corporate presentation in November 2023 Kerim stated that there is a Dokwe South (Shaba). Dokwe South is outcropping (with little or no overburden) and the Ariana team seemed very excited about it although no prospecting results are available. From the presentation on Thursday it can be seen that there is an extensive area where there are significant surface anomalies at Shaba.
Dokwe already has four times the reserves than Kiziltepe and Tavsan have and remember Ariana only has claim to only 23.5% of Zenit’s reserves.
It is of note that Ariana is attending the 121 Mining Investment in London. This connects mining companies with potential (institutional) investors. This ties in with the ASX listing. I very much suspect that Ariana will have a further share issue that will be sold to institutional investors and that this cash will be used to further the prospecting at Dokwe (Shaba?) with the intention of increasing the gold reserves substantially.
In the assessments below I am not discounting future profits as both the assessments are at current value.
All the calculations are rough and ready.
Assessment of what Rockover shareholders will get from the merger.
The Rockover share holders will get about 37.5% of the future profits that accrue to Ariana. This is the 23.5% of the profits of Zenit in the future. I am going to be quite generous with the assessment of the future profit.
Current projects Kiziltepe and Tavsan are forecast to produce 25,000 oz of gold for the next ten years. Thus the future profit at $2,000 per oz gold (assume $1000 per oz profit) is about $250 million of which Ariana will get about $59 million therefore Rockover shareholders will get about $22 million of future profits that would accrue to Ariana.
There are no other projects that are at the PFS stage in the current portfolio.
The other bits and pieces that Ariana owns may be worth about $6 million at present (although Ariana’s current shareholders think they are worth $0), so add $2 million giving a value of $28 million.
Rockover shareholders get 37.5% of Ariana’s current assets and future profit in exchange for Ariana shareholders getting 62.5% of Rockovers asset of Dokwe.
Assessment of what current Ariana shareholders will get from the merger.
Assuming the mine is built then current Ariana shareholders would get 62.5% of £1,000 million or $625 million of future profits. Even if there is subsequent dilution in the future (e.g a JV to fund the build costs or share issues to cover further prospecting costs) then I think that Ariana shareholders will still get a large amount of future profits from the deal.
My instinct is that this is a good deal for both parties, on paper it appears that Rockover could get a better price selling out to another miner right now. The directors of Rockover are very experienced, and I believe that they see that a future with Ariana will give the best long term returns through Ariana’s holdings in Dokwe, Zenit, Venus, WTR, etc.
I believe that this is a win-win for both parties depending on how Ariana funds the future exploration and the building of the mine and processing plant at Dokwe, and how much more gold there is at Dokwe. This deal would certainly make Ariana into a mid-tier gold miner.
How will Ariana proceed if the merger goes ahead?
I do not believe that Ariana would build and operate the mine itself but would look for a JV or at least a development partner. KS when questioned stated that Ariana had a very good working relationship with Proccea and were looking to Proccea to help to design the mine and processing plant. If this was the case then it would be sensible to have Proccea build and operate the mine and processing plant. KS also stated that there was no need to look for others. In the context of what was being said at the time I assume that he meant no others than Proccea. It was noticeable that Ozaltin was not mentioned very much at all.
It was also stated in the presentation that Ariana would look for bank loans to fund the development. When Ariana was just a start up, with Kiziltepe as the only asset, the JV with Proccea managed to get the funding for the mine as loan funding. I would think that it is highly likely that loan funding would be the vast majority, if not all, of the funding for the mine once the final feasibility study is produced.
Pros
Ariana gets 100% of a large gold reserve (which might be very large depending on future prospecting) that will provide a considerable amount of profit in the future.
If played right, despite the share dilution, existing shareholders should benefit both from increased capital value of shares and, with a bit of a delay, an increased ability to pay dividends.
The two directors that would join the Ariana board are very experienced.
Cons
Current shareholders suffer a relativly large dilution of shares.
The development of Dokwe might result in further share dilution.
Dividends are probably delayed by a couple of years.
Conclusion
I think, with the information that we currently have, that this is a good deal for Ariana and for Ariana’s existing shareholders despite the dilution and risk of further dilution. However I do want to see the revised PFS before the vote on the merger. If I am then satisfied with the merger I will vote for the deal with my four million shares. If any shareholders are absolutely of the opinion that the merger is a bad deal without any further information, then I would suggest that they just sell their shares.
I don't know Van. It's a significant question because I doubt the resolution can be stopped of the requirement is 51% but it definitely could if its 76%
Question 26:- I can't see how the Co. regard this as only needing an "Ordinary Resolution" which requires 51% of the vote in favour.
I think that is wrong. I believe the Co. need a Special Resolution with 76% voting in favour.
Ordinary Business (Ordinary Resolutions) includes the following business:
Adoption of final accounts.
Declaration of the dividend.
Retirement and appointment of Directors.
Retirement and appointment of Auditors and fixing their remuneration.
You need a resolution to issue new shares in a UK company. The Companies Act 2006 requires private companies to pass an ordinary resolution, while public companies need to pass a special resolution.
With a Special Resolution (SR) you also need 76% in favour (three times higher than the votes cast against it.)
The notice of the general meeting should be duly given to the members, and the notice should contain the intention to purpose the resolution as SR to be mentioned specifically.
The resolution is required to be passed by any methods, such as voting on a show of hands or polling or electronically by the members present in person or proxy or postal ballot.
PLEASE CORRECT ME IF I AM WRONG
Thanks John. Have done!
Course you can if you want! If we cant laugh what can we do?
Very good. I had a laugh. Could I copy that across to ADVFN? I'm sure some would appreciate that.
Correction. 2.3p
Silly me
Just spent a time reading the Q&A.
Disappointing, or maybe I just got out of bed the wrong side. I would compare the answers to those given by politicians to Laura Kuenssberg on her Sunday morning program. Mind you at least KS has a fallback career as a Tory MP if this sinks the company.
In many cases, particularly the awkward ones, Sener answers a different question to that posed. Or just plain misleading. Examples:
Q The Ozaltin deal was pretty rubbish wasn't it?
A No, the share price went up from 2p to 6.25p! it was great!
Observation: And when everyone stopped looking at you as the messiah it fell back, down to 1.6p only 2 months ago. Over 4 years on its only 2.4p now
Q Why didn't you release production guidance on time this year?
A The dog ate my homework
Observation: Woof
Q Several other companies have shunned Dokwe because of deep desert sand cover. Why is this not a problem for AAU?
A We have found that B&Q have introduced a range of big shovels so its fine!
Observation: I must take my morning tranquiliser
Q Will production really start at Dokwe in 3 years as mentioned in a very very recent RNS?
A Well I said that but its complicated
Observation: We've heard it so before many times Kerim so stop digging as no one believes you anymore.
Q Why no Gantt chart
A Because timings can be hard to predict as they are out of our hands
Observation: if that was true then surely sometimes things would happen more quickly than expected. Like just once maybe?
Q Was involvement in Cyprus a good move
A Yes
Observation: That's a no then. £180k of AAU shareholders money spent to give the Apliki owners fresh data to increase their asking price
Q Will divis be paid to AAU shareholders when Tavsan is in steady state production
A Not sure, maybe
Observations: Ah, not a snowballs chance then
Q Do you care a jot for your ordinary PI shareholders
A Ha, Ha, of course not, don't be silly!
Observation: Ok I made that one up.
Have a good day fellow sufferers
‘ Posters keep rattling on about Dokwe's gold deposits being under the Kalahari Desert. This desert would appear to me to be more to the West, in Botswana & Namibia.’
No body has posted that in here!
‘For what it's worth I also decided over 5 years ago to stay well clear of Africa, China and the Russian Federation because many Companies and consequently their investors have been " ripped off" badly by authoritarian corruption.‘
Sounds a bit like Canada and UK, as for USA it’s a farce, hopefully we get free market President!
I sold out in the last spike in gold and have reinvested in this possible merger. Ariana's, S/P has treading water for years as has the dialogue between you long-suffering shareholders. This merger and the increase of ounces in the ground will lift the company from the malaise it has been in for the last few years. It is good to be back!
Posters keep rattling on about Dokwe's gold deposits being under the Kalahari Desert. This desert would appear to me to be more to the West, in Botswana & Namibia.
But I digress. At long last, Van Van, you appear to be getting the vibes I began to worry about a long time ago about Ariana. John's viewpoint about our " merger" also added worries. Sadly, It seems to me to have evolved as just another example of so many unpleasant AIM experiences which over the years have duped their investors and produced a comfortable lifestyle for those " on top (literally )of their " pile " . Initially I really believed that I had found a wonderful route to riches. In hindsight my time and investment was really many wasteful years here. Thus eventually I lost my faith in all the hype and promises so over the last year I reduced my holding and now I have none. So far by investing my former AAU money elsewhere in real Stock Market leaders, in every case I have gained regular quarterly dividends and all my stock has risen wonderfully in value.
For what it's worth I also decided over 5 years ago to stay well clear of Africa, China and the Russian Federation because many Companies and consequently their investors have been " ripped off" badly by authoritarian corruption.
Yep Van, as I said yesterday the circuitous sentence from the RNS about 3 years did mean it incorporated more than a little ambiguity. Could mean they may be able to start to commence development in 3 years! I don't recall Sener even mentioning 3 years this morning, perhaps he thought it best not to. If Dokwe doesn't soak up the dividends then Salinbas will. In fact from the current JVs major shareholders viewpoint Salinbas is more important, at least at the moment, and since Ozaltin control Zenit then AAU may not get dividends from the JV because it will be used to promote the development in Eastern Turkey. That raises the question where the bloody hell does the money come from for Dokwe development, the ex Rockover directors will want some action there because they are no spring chickens themselves. They will of course end up as the major AAU shareholders in June or July this year. My fear is huge debt on the AAU balance sheet, if things go wrong the loan creditors foreclose and equity holders tend to get wiped out.
The Rockover directors, shortly to be AAU directors, may be more astute than this mornings double act, they will hopefully not sit back and allow another big payday for Ozaltin if the Zimbabwe development is to be funded by a new JV there.
You talk about the AAU development not suiting those of our age. Or MDVs. I suspect that the whole development profile is geared to someone of say, now let me think, oh yes, someone of maybe Kerim Seners age??
And this John.
"we anticipate advancing the Dokwe project towards production within the next three years"
Very Motherhood type words. Advancing towards - what does that mean? Not we will be in production in 3 years.
The slide with production from Salinbas is also a joke as was the comment that we are a dividend paying Co.
We need more honesty and much greater clarity. Gritty hard hinting statements.
They need to put themselves in the shoes of shareholders and consider where there are coming from. Consider carefully what they want to hear, primarily of course a focus on how actions will increasing value and reward via dividends.
The need for a Corporate savvy communicator with contacts etc. will only get bigger as they expand and face Institutional interest. It is still very poor currently and we can see that in the recent trading reaction. They have failed so far to excite investors with this new opportunity, perhaps also due to the track record to date.
Posted this!
I agree we did see a better performance from MdV this morning. Sceptically, perhaps he fears the re-election vote!! But yes as he ages he must be looking for a shorter return than one that keeps getting pushed into the long grass.
But as my wife said to me this morning, weren't we promised a dividend once Tavsan was up and running. Have they now rescinded on that? Given the age profile of many here I'm sure that is seen as a very poor show. If you promised to do something important like that and talk about wanting the "financial discipline" etc. it brings, then you have to stand by your word. Given they have been doing DD on Dowke for around a year, they must have had an inkling of what they intended to do. Promising a dividend and thereby perhaps encouraging people to buy shares or certainly hold on and then do the opposite, as though it matters not, is very poor form in my opinion. Those wanting that regular dividend, who were perhaps prepared to hold on ignoring share price gyrations whilst they got an income, could well now decide to sell or reduce their holding. I wonder if they have any concept of how frustrating missed deadlines and failed promises are. Like promises over Salinbas, Cyprus and dividends etc. one starts to loose faith and trust.