If you would like to ask our webinar guest speakers from WS Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund a question please submit them here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
Well, I guess the AGM will have some interesting questions. Can't make it but would like to be there in person.
He may well have thought that and may well still be right - I wouldn’t hold that against him. I do however need an explanation as to why every single milestone from their November presentation has been missed. I don’t know how long it takes to get debt arranged, but he should. He either didn’t know a bank would want an updated feasibility study or he did and misled us. I’m honestly not sure which is worse!
Yes, maybe I'm too trusting of what comes out of Tony's mouth when he said 'investors will be well rewarded' . It sure doesn't look like it at the moment.
I think copper may have actually dropped since November - it was on a sustained run of over 4p.
I think you’re broadly right on what the HOA values KSK at, since when the resource has grown. But that deal hasn’t completed and doesn’t look like doing so it’s not a concrete starting point. However, hopefully DOID can see at todays values they’ll be getting a great deal compared to what they *provisionally* thought was good in November. Personally I’m completely sceptical about what’s going on, the RNS’s are full of holes/changing accounts.
Fingers crossed the value underground rescues us.
So, and I might be wrong here, the HoA valued BKM at around £80m and the price of copper is still above where it was when that was announced. Yes it's coming down so with the global threat of recession but long term value is still positive.
2.2p would only value the whole co at around £42m. I know the market is saying something different but that's quite a change in not too long a time period.
I don’t think we can completely rule out 3 because the due diligence was to confirm the deal and they’ve seemingly backtracked away, so it’s speculation as to why isn’t it. Don’t forget they had their own consultants review it first, following which DOID sought further help from the ITE.
£25m is todays value, I can’t them bidding at todays value, surely it would need a significant premium from this low? I think their initial investment was circa 2.20 and I could see them being prepared to pay that and shareholders accepting given the apparent lack of alternatives (5 interested partners last August became 2 serious ones)
The last RNS did state that DOID we're happy with the DD, so let's assume not option 3. I guess if options 1 or 2 is happening what would Ars accept?
The resources still have inherent long term value and maybe more value creation to come. It would be odd to also employ a new CEO to then sell the company on the cheap.
Ars aren't in a great position I guess but Tony did say they're financed to the end of the process. Certainly £25m for the whole co seems not a lot to me.
I’m one of those who has a strong view the HOA won’t be happening as announced, but I suppose DOID have probably intimated they’re just considered their options and will discuss further.
“The Company and DOID are advancing discussions on a preferred path for consolidating the strategic partnership between both companies” from the RNS would cover this.
Realistically they’d be mad to sign up to those terms, hence the change in the story that DD completed the deal.
I see 3 main options from here, assessed in likelihood order.
1. Full takeover offer. On the assumption DOID we’re happy (as they formally announced) with the DD the risk is now less than when they signed the HOA as closer to funding and Asiamet much cheaper. Plus the reward higher due to BKZ.
2. A new agreement whereby DOID take a bigger % of KSK (similar logic to above) and this would also resolve Asiamets funding gap.
3. They’re not interesting in a partnership at this stage. This would need to be communicated to the market and would assume they weren’t happy with the diligence.
As to when any of the 3 will play out my guess is after the revised feasibility study and further ITE /bank review which will strengthen their confidence further. Commercially however they might think it’s worth a crack now at the low levels.
What I find poor is as recently as November Asiamet we’re targeting funding being in place by now. Did they not realise they’d need to do a revised feasibility study or did they mislead about this?
Who knows, it doesn't look like it though as no volume. But just thinking about the HoA and the fact that people are saying it's dead in the water. If that's the case and Ars knows about it, that would be price sensitive information and they should RNS that fact.
So the fact they haven't either suggests the deal is still on, or Ars is keeping that from us which is naughty, or DOID have changed their minds and not informed Ars.
SP
So do we think DOID are going to start buying shares on the open market now, with the DP so low..?