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The buyer will be be getting fair value as the resources will become even more rare in future as the hydrogen economy comes in and the big rise in fuel cell demand. Imagine fuel cell power stations.... they will use lots of palladium and platinum for the fuel cells as the cells themselves will be huge.
Sorry Flint!
In a non sadistic way I'm glad your here with the first hand experience of what I've mentioned
You've obviously seen the SP "languish" for some time to then suddenly rocket on news, I know it's not identical but a very similar story in a lot of ways
1) anders: RE: Tax. I am not sure, that’s why I said it could be less. I am being very conservative - therefore if there is no tax we can enjoy 20% of whatever calculations you or I use
2) Dealer55 “If it was all that simple why on earth are we at 2.5p”. You’ve been here for a while
- you have seen how we went to 4p numerous times on far less (extremely positive) news.
- You are aware of the SP manipulation
- you can check the identical graphs for the past few weeks
- you can see how many green boxes came out the woodwork in the last month or two
- you may refer to previous posts on MM, shorters and such, and how they are extremely - for lack of a better word “SCREWED”
- moreover - our SP Should be a reflection of our predicament based on going at it alone, with a little raise because of expectation. But when our asset is sold for a fair value- the share price will mean jack diddly. It’s highly disingenuously to use our share price to counter a conservative and fair mathematical valuation, benchmarked against previous deals. Which is not only logical but advised by Dmitry Sushov
3) yes a deal isn’t confirmed: well, my post is obviously based on a deal going through. Which based on what we know about:
- palladium climate
- South Africa
- precious metals boom
- supply deficit for 8 years
- lowest cost mine
- negotiations progressing well, as confirmed numerous times in RNS’
- Banks still working for free
- company been in a closed period for weeks
I can understand your expectations to be low. I assure you, I try not to “ramp” and in order to not get my hopes high I use the Brokers target of 12.75p, to 20p (like yourself) - and that’s if the BoD got really drunk and gave MT away for peanuts.
I purely suggest these figures, as I mentioned, on a FAIR and perhaps minimalistic valuation going by the fundamentals outlined in previous interviews, sales, RNS, and palladium crisis today.
Same can be said of most companies SP's
Bushveld Minerals did a very similar dance to EUA currently is for two years, bounced between 4.22 and 1.27 for just shy of two years before hitting a steady rise on news
A company with a metal that was in demand in the construction industry (Vanadium) once confirmation of asset was established it jumped up to 7.48 ish then carried on all the way up to 48.40, it's since halved and wasn't a position of sale etc we are but the build up to the SP being moved north and quickly is/could be very similar
Dealer - we are a very small co, under most radars.
First thing any investor would do is look at the accounts history. Ours is nothing to write home about - most positive developments have happened over the last few months. Remember, accounts are retrospective and there is a fair time lag between events happening and events being reported in ARA. By the time our ARA look like a fantastic investment opportunity, MT would have been long sold and WK firing on all cylinders.
Recent pump and dump + bear raid has left a lot of punter money scared of ever buying EUA again.
Just a few reasons why the buying pressure hasn't blown the fuses yet.
If it was all that simple why on earth are we at 2.5p.
Well no guarantees on a deal for 1. Value in the ground is one thing. Let’s see but if it passed 20p in share or some form of div and lower sp deal. Got carried away on AIM bb before. I’m staying grounded.
Brotherjoey, are you sure there’s any major tax to pay on profits from a sale? Seems stamp duty is payable by the buyer to HMRC. Does anyone know Russian business taxation rules?
https://uk.practicallaw.thomsonreuters.com/7-501-9543?transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=1
Dealer55 - “all the talk of 30-80p guys seriously thats pie in the sky we can’t hold 3-4p”
Whilst I agree that 80 is a bit out there, do you honestly think 30p is pie in the sky?
How much do you feel the company would sell for - under $1.8bn dollars?
- $1.8bn = ~£1.4bn
- 80% = £1.116bn
-(20% tax, which could be less) £893m
-Banks 5% -£848m
- EUA 5% for moneys in the bank (which will reflect in our mcap so still raise the sp) =£805m
- ~28p
Which is under 30p, you’re right. But would you honestly feel EUA would let it go for under $1.8bn?
Based on 15moz - that’s $120/oz
“on a per resource ounce basis, Implats’ bid for NAP ($214/reserve oz 3E) was far more expensive than Sibanye’s purchase of Stillwater Mining ($100/oz).
On an enterprise value (EV) basis the NAP acquisition equates to $197/reserve oz, much closer to the value of the Stillwater acquisition of an estimated $135/reserve oz”
So just a 20% rise compared to stillwaters acquisitions, and almost 50% lower than NAP?
Also considering:
A) Stillwater also had lower all-in sustaining costs at steady-state of some $575/oz (compared to $800-900) (64% and ~250% more than EURASIA)
B) Stillwater at the time of purchase was ~$700 (compared to today’s circ $1950)
And NAP At the time of purchase was approximately $1750 (almost $250 less than today’s price - this increase is actually about 70% of our production costs)
Therefore: each had lower palladium prices at the time, and each costs much more to extract than Monchetundra. We also have an extra 5moz within our radius which we can apply for, and a likelihood of an additional 20moz within the vicinity.
The company have told us it puts us in a totally different league of palladium mines in operation- which is why it’s probably tough to put a price on it. It’s a monster.
But I would highly doubt they would sell it for an equivalent of LESS than the previous deals. Therefore a minimum would have to be around 30p. What do you think? And how would you calculate our worth in terms of SP- If 30p+ is too much?
https://www.miningmx.com/news/platinum/38824-how-does-implats-lac-des-iles-stack-up-against-sibanyes-2017-stillwater-deal/
https://www.mining-journal.com/pgms/news/1373052/implats-to-buy-north-american-palladium
PS. Although we are less developed, it is very easy to get going, we’re lucky to be in a Palladium rich region with the biggest Palladium producers in the world beside us, along with a refinery.