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Crabby
I *think* most ppl believe it is evidence that EUA will not run out of cash - and that is probably one of the larger risks mitigated
It is, I also think, just that - and is unlikely to be carried out
IMO They are not raising any shares for money - just the option to be able to allocate shares if they split the assets and sell separately.
GLA
Appreciate it’s up to 250 million shares but the company has managed to get this far with a few million knocking around, WK is in the best position it has ever been in so will be bringing income anytime now.
60 million is a significant amount all of a sudden I.e. it must be for something substantial IF and it’s a big iIF, that’s what happens.
PIface
I would question whether or not the NED and by default any company associated to him - would be able to buy them under the FSP?
Casper
It's an option and up to a maximum of 250 million shares crabby.
IF the BoD are raising 60 million they must have a use for it, they’re not daft and not exactly desperate for cash so it would be another chess move in my opinion. Quite a lot of money to raise, I just hope it’s a move aligned with the companies strategic options and not to acquire more resource, they’re got more than enough to last a life time already!
Standard resolutions every year though. I think the Japanese may want some or the NED. I guess the will want to be in at the 22 to 29p range of others. Maybe why we are being held down now. Once its sorted could be a wrap.
It might not go on anything - it's just an option.
Ahh get it now. I thought it was something a little different. I followed it’s the ability to draw down as required. Until they set the price you can’t value it. £60m agree is massive but it’s not all adding up for me yet as to what’s going on.
calamari
Maybe you can read, but you don't understand either, do you?
Hi Dealer55,
My understanding is it £250,000 of shares at a nominal value 0.1p. That means that at the current price, it would raise £60 million plus. I'm sure we could do something with that.
It's a vote to allow the Bod to issue up to 250m new shares. That's up to and not they are going to.
Shares carry a nominal value of 0.1p in our case, but would be issued at whatever price the directors and broker agree.
If the FSP fails the share price will tank, as it will reflect a lack of faith in the BOD. Would it recover? Possibly over time, but what would it be worth in the event or a no sale, single figures or early teens at best. Don't get sucked into the hype, this is still a prospect with significant risk attached.
A lot more.
It's not £250k dealer, that would be the value at the nominal 0.1p share price.
Bob what I don’t understand is negotiating position at this stage. We had cash, plan b to mine and if the buyer(s) whatnot what we have we don’t need to reinforce with a measly 250k surely that won’t help significantly in any negotiations. BOD need to update on FSP survey it’s duty bound and over due.
Depends if there is still time over the next few days to add new resolutions and amend the circular. It could be that the initial notice and one resolution provided is more about just getting the meeting in the diary and more could follow in the run up...
Not sure if there is anything to restrict an emergency addition, or how many days notice represents the cut off, after which it is not possible.
Also worth thinking about the timescales here:
The RNS makes reference to the EGM being to strengthen a negotiating position. Now, the suggestion presumably would be that the resolutions require to pass at that EGM before the negotiating position is in fact any different to what it currently is.
Would that not therefore potentially suggest that we are unlikely to receive the RNS we are all waiting for before that EGM?
If you are a self styled "trader" or are rainbow chasing that gives you a few weeks to sell, chase your rainbows, and buy back in before the last RNS is likely to drop.
Obviously I would love the sale to conclude before the EGM, but honestly I don't see that as likely, hence the chances are a relatively stagnant share price pending those votes with a potential increase as people buy back in around the date of the EGM.
May explain the current apparent trend to some extent.
"I believe the market is now valuing Eurasia at a blended fair value taking account of 'going alone with Rosgeo' and a 'no sale' with a 'long term Japanese buyer'. As in, if the FSP was cancelled tomorrow, the sp would likely consolidate to current levels... c.25p-28p range."
I agree with this, and think it's been insufficiently remarked on. One big worry lots of people have had in recent months is: what happens in the event that the FSP fails? Do we see another crash back down towards 7p? The assumption was always that, in the short term, that would be the case. But now, any RNS stating the end of the FSP with no sale would surely be accompanied by a detailed plan for not just bringing MT to production, but also doing the same with the Rosgeo JV. The future dividends beyond the middle of this decade are utterly, utterly mind-boggling.
So, I think you're right: events of the past few weeks - which have arguably been as much about demonstrating Russian state support and insulating the firm against any negative outcome in the FSP - unquestionably mean the SP will solidify above 20p, and would quickly go up beyond that as we moved towards production.
The other thing to remember is that, if the FSP fails, it's because the deals on the table - after 18 months of formal and informal negotiations and USB/DLA Piper at the table (!) - are not up to par. That is, they do not value $100bn+ resources highly enough, in market where the value of those resources are increasingly daily. Any short-term shock to the share price would be short-lived as the realisation of long-term shareholder value that vastly outweighs what can be realised in the FSP would sink in dramatically.
Since the FSP announcement last year, the sp has moved around significantly.
In the early months, the direction was dictated solely by the FSP and understanding the resources in the ground, i.e. the Tipil licence and MT flanks update. This saw the sp rise from c.7p up to the 17p-22p range.
Then we started to get II investment, the placing at 22.5p (and index buying) which saw a spike to over 40p. Culminating with the WK DFS update.
We then consolidated to the 28p-30p range with the knowledge of WK, MT and Flanks - and a much better idea of what (at that time) Eurasia was worth as a company... this was likely at a large discount to fair/true value due to risk being priced in...
We then got Alexei's sale and subsequent explanation. This rocked the boat. But was short-lived. I believe this added another layer of risk to the FSP which is why the sp didn't fully recover to pre-Alexei sale levels.
Confidence returned with the release of the WK update and Rosgeo agreement - though I think the market has changed its stance on how it values Eurasia... particularly the reaction to the Japan news.
- For most of 2020 and early 2021, the company had been valued solely on FSP (value of full sale with large risk priced in).
- Since the recent Rosgeo announcement and Japan news, I believe the market is now valuing Eurasia at a blended fair value taking account of 'going alone with Rosgeo' and a 'no sale' with a 'long term Japanese buyer'. As in, if the FSP was cancelled tomorrow, the sp would likely consolidate to current levels... c.25p-28p range.
- A sale of assets (WK, MT) will likely now result in a special dividend.
This is my opinion on the strange sp reaction to the last few RNSs released (Rosgeo and Japan).