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I think the stand out comment from the proactive interview is Nick saying hes under promised and over delivered...not sure thats correct in this instance.
This is a great deal if it completes as scheduled. $1.8m upfront plus an uplift to the equity value of Arc by saving approx. $200k p.a. on running costs.
A 5% capitalisation rate on that saving is perfectly reasonably so the up-front positive impact on the equity is about $4m or 15% of the current MCAP. Add to that the removal of a significant management distraction, potential stage payments in future plus the fact that the deal removes funding pressure and you have a very good outcome in my view.
and we're saving 40k a month..............anyone who thinks this is a bad deal go and read up on DRC
The SP is bonkers!
Plus more results within 2 weeks!
Majors have been ON SITE and another major is visiting in the next couple of weeks! They are serious
Plus it makes us more suitable for any future Buyout without anything from the DRC on our books.
As Fulmar has said, some cash in the bank has to be more positive than a DRC asset hanging around our necks and costing us cash. Arc can now plan next seasons drilling programme and hopefully the majors will keep en even closer eye on us.
correction we have saved "closer to $40 kpm" ( re the pro active pres). over £360k p.a.and now have more cash in the bank.
Sometimes ,(like all things in life) you have to just cut your losses and move on,if you can do it with a few bob in the bank- DO IT !!!!!!!!
It's absolutely amazing news! It just doesn't suit the short holders.... Copper is the future of ARCM and this sale is unbelievably good news for the future
More to the bloody point,we have just saved £163,000 p.a. cost of running the dead asset.Not the price we would have hoped to achieve,but anyone who can't see we are financed through at least 2 MRE's just doesn't want to see it.More drills and news to come,with the right timing for copper .
A long way below what was expected but it's a 'non-core' asset gone. It's no longer a liability plus we have much needed cash which should negate the need for an imminent placing. If there's another drill 4 equity next season then another cash raise is pushed further back.
The end game for me has always been the sp moving on as a result of major interest in our copper assets, so CASA is a sideshow which has disappointed but it's not the main act.
So we get $1.8m upfront and the rest dependent on if it reaches 6m, 9m and 12m.
So pretty much we sold for initial amount and if they do nothing with it for 5 years we don't get anything else. Seems odd to limit it to 5 years as we have sat on it for years
There are better more attractive gold resources out there than CASA so how long would we be waiting for a better price whilst losing cash on a non core asset?
This will allow copper ops to push forward with much less risk to investors.
Cheap sale-YES....HOWEVER, cash is always better than unwanted asset (with liabilty...) significally reduce the need for placing,helps the company to focus on the job in hand,and potentially a source of further future income.....not bad news IMHO.
Agree about the jurisdiction. I haven't looked in detail recently regarding the geology / grade but if it's a bulk tonnage (close to the surface) oxide resource at 2 g/t it 'could' be a nice little earner. More likely, it's not. And, it is the DRC!
This is fantastic news, 10% of the market cap up front.... plus additional to come.. expanded drilling program... West Lunga results next week? Very exciting times for ARCM. GLA
2g/t average ore quality - let’s be honest this is a very low grade deposit in an awful jurisdiction I’m surprised it didn’t sell for lower.
That equates to just $2-3/oz in the ground. Must be one of the cheapest prices in gold mining history - useless.
I thought Nick said it was worth something in the $15-$20m range and he wasn't going to give it away cheaply. Another broken promise...
for peanuts at first glance...
"The cost to Arc of the shares being sold is £5.1m ($6.5m) against the gross consideration of $9.8m representing a potential $3.3m gain. " £5.1m costs of sale? Really?