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Can tellI’m worse for wear.....just checking it was on the right board. :-(
Chain, here are my drunken simplified thoughts. Whatever it’s worth hypothetically to Barrick, it’s worth the same plus a pound to Newcrest. Please take into account I’m down half a bottle of gin. :-)
Mushroom
You're different level.
Luv your posts.
I need some of those magic mushrooms you are on!!
Regards
Coach
The Chain.
It seems to me that if Newcrest want to buy Havieron they will not offer x pence per Greatland share.
They will make a cash offer for the 30% share that they currently do not control (plus the cash amount that they have not yet spent on the current phase of the joint venture). If the deal is accepted Greatland shareholders will continue to hold their existing shareholdings, and Greatland will own 100% of all the other sites plus the cash received for Havieron from Newcrest.
Hi TMT. I take your point re value but there will be a further 80km of drilling before our 60% becomes 30%. That in itself could significantly increase the resource value of our share.
There's a lot of pieces to this particular puzzle. I don't think we'll be letting it go cheaply
I don't post much but the Brains from Thunderbirds post made me spill my wine.
Happy weekend all
Q
@Chain
I'd be very, very surprised if the JV agreement allows Newcrest to sell Hav. The JV agreement might possibly allow them to sell their share in the JV to Rio or Barrick or whoever, but I'd actually be surprised if it allowed either party to sell their share at this point without the approval of the other.
But if they can sell their share, that share would give the buyer the right to continue what NCM is doing and to very soon own 70% of Hav. If they wanted to make an offer for GGP's 30%, they would be free to do so. Or, if they wanted to buy out GGP's share now, they could negotiate a price for the 60% that reflected the fact that in a very few months they'd have half of that 60% for almost nothing.
If the suggested buyer, or NCM, is going to buy out GGP's share of Hav, neither they nor GH will be able to ignore the fact that the 60% is about to become 30% at very little cost to the buyer. That WOULD be reflected in any agreed price. Nobody is going to say, "Well, we think have is worth £5Bn and we're going to pay you £3Bn for your 60% share," when they know they'll have half of that 60% in a few months. Just won't happen. And GH isn't likely to turn down a great deal for the last 30%, if it is offered, even if he still technically owns 60%. Why would he do that?
If he thinks the 30% is going to be worth £2 Bn and they offer £3 Bn for it, he'll take it and not quibble about the other 30% that he's losing soon anyway.
That would be F. A. B... have a good weekend.
brilliant mushroomkid LMFAO
Mrs Mushroomkid is busy chewing a wasp at the moment but she said earlier, while doing an impression of 'Brains' from Thunderbirds, that' ahah provided the ahah assay readings are in keeping with the anticipated ahah levels and ahah both participants are agreed they will be making me ahah lots of ahah dollars, then I believe that ahah 50p per share would be ahah acceptable.
I'd be very interested to hear the views of mrs mushroomkid on this matter..
Cont... that scenario B is the more likely, but I concede that in the absence of facts, scenario A remains possible, though GGP job/s should be lost if that is the case.
Anyway…….more food for thought perhaps and maybe one of the many knowledgeable Greatlanders can set us straight on this one ?
vmn
Further musings.. Meant with good humour in response to TMT.
Hello mate…….I saw your posting and the responses…….most of them reasonable. I disagreed with many but hey, it’s a billboard and ALL opinions have value.
There was one post which I think it is worth taking issue with as I think it is potentially misleading……and it would be good to see if anyone else could help establish facts. It is with regard to the possibility of a takeover approach during the JV time period.
So I have here, for your edification (and possibly mild amusement) a theoretical situation to play out/with. Let us say that on Monday morning, Barrick Gold (who I may yet mention in further ‘musings’ as you label them), make a takeover bid for Havieron and, to please some of the happier bb punters, let us say this is set at an unbelievable premium of near 400%.........so 50p a share.
Segue to the Newcrest HQ in Melbourne……….
Sandeep: Streuth !! 50p !! what an offer…….I think we will accept immediately. We are the majority shareholder with 70% and so will also take 70% of the proceeds ……maybe 75% ?? I will get straight on the dog and let GH know.
SCENARIO A
Gervaise: Bloody hell Sandeep…..it’s your lucky day mate, I have just been in consultation with my top special advisor and expert on everything, and he tells me that although you might not even have paid the outstanding 25mill up to around xmas to complete the JV, that you are quite right. You are already the majority shareholder……all you have to do is give me 25mill and you can have the extra 30%........about 2.5 billion I think. I’m told that although you only own 40% at the mo through the JV…..it does n’t matter and there is nothing I can do about it. Bu&&er me….I wish we had thought of that beforehand !
SCENARIO B
Gervaise: Get off Sandeep yer dozy drongo……DYOR !! Mate you’d get slaughtered on our billboard. I refer you to section 16, clause B, subsection E (or somesuch) which clearly states………If during the protracted period of the JV, an takeover offer shall be received, then the JV will be frozen at that point until a response is made. Said response will be decided by the prevailing relative shareholdings of the two participants at that time…….or somesuch legalese. To wit……we’ve still got 60%.......we’ll accept the offer and that will be our share.
Now I do not have access to the minutae of the JV agreement, but as Havieron has effectively, been in the crosshairs from a takeover perspective for a long time now, I would find it passing strange if the detail guys at GGP had not anticipated this possibility.
It does not matter who makes the bid, the reasoning is the same. I think that if NCM want to bid for Hav now, they (likely) have to bid for our 60%. This was my original reasoning but I excluded it as it is lengthy. My personal thought remains that scenario B is the more likely, but I concede that in the
Ok, trucky, I'll try to shorten them. I do a lot of writing in my work and I do get on a roll sometimes.
TMT glad you liked it. I do understand where your coming from but long long posts ?
@MFU "absolutely superb debate "
Your name could have been included. Thought you made a great point earlier, "IMO these high grade business people could definitely come to a mutual agreement."
Absolutely agree. If both sides want to do a deal, there are ways to find a win-win, now or later.
@trucky
LOL. Literally, I laughed out loud.
I type fast. And I'm off work this week. And I take my time to make investment decisions, thus my screen name. And, I do like to explain my thought processes, rather than just express opinions, which I suppose is rather egotistical.
Anyway, thanks for making me laugh. I'll be working next week....
My pleasure Socialist.
Chain
THE_CHAIN
Thank you for 2 excellent posts and the wonderful debate that you have created here today.
You have succeeded were I failed so blatantly last week.
Thank you.
Takingmytime.. should that not be talking my time. with all those very long posts of your's ..you kind of remind me of socialistB... but anyway " Talking My Time " might suit you better
Great debate, Thank you for your insights and thoughts.
Why do you keep posting the same message. !!!!!!
Four more minor points that don't really detract from your father's main point, with which I agree, but which it is probably good to have clarity on.
1. "the idea that these big players would invest in any company without an income stream is IMO, highly unlikely."
I disagree. If an II believes that the company has assets that substantially exceed the market cap, and if their investment strategy is to seek capital growth (rather than income), it's a racing certainty they'll be giving a long hard look. If they believe there's a reasonable chance of those assets turning into cash within a reasonable time-frame, they'll buy.
2. "An MRE and perhaps, FTSE memberships would also be needed/helpful."
FTSE memberships come with requirements that, at this point, the company does not want. I think this is unlikely.
3. "Why does he want to pay an arm and a leg for the other 30% and **** off the junior partner in the process with an undesired (assumption) approach."
I don't think this is well-founded. Why would it upset the jr partner to offer to buy them out? They can always say no. GH goes back to the BOD and says, 'Hey, mates, NCM is interested in buying us out, do you want to enter discussions?' They say, 'Yes' or 'no' or 'how much'? If it's no, GH phones SD and says, 'No, but thanks for asking.' Who's upset by that? If it is 'yes' or 'how much', how is that causing a problem?
4. Finally, your father suggested the joint approach is how NCM likes to work, which appears to be the case, historically, and therefore they are not that likely to change. That seems true, but then he also acknowledges that exporation/mining combined is historically not been what happens, and suggests that may be going to change. A little awkward to use history in one case and ignore it in another....
All that said, I tend to agree with his conclusions. I do not think GGP will be bought out entirely. I put the chances at less than 20%, unless Barrick or someone else comes in and starts a bidding war. I think NCM likes the way things are going, and are happy to stick with it. I think GGP is likely to end up with a mining division and an exploration division, and make a lot of money over the years. I put the chances of a buyout of Hav at somewhere between 20-40%, definitely higher possibility than full buyout of GGP but still less likely than not.
But I'm guessing. Thanks for your very thought-provoking posts, to you and your father.
Chain/TMT/Paddy/Stuart et all...absolutely superb debate .I would love to be watching this over Zoom with loads of investors beats Question Time in to a ****ed hat keep it going !! Have a great weekend all. MFU
@Chain "Fair comment TMT. We shall see, either way I don't see how we loose with either scenario. It's good to be in greatland."
I agree, absolutely! I also agree with your / your father's conclusions. But if the bid should come in after all, wouldn't want people to be confused about what's going on.
I also do not agree with this point:
"Everyone would like to see the SP significantly higher, but for this to happen. GGP bill board members need to ask themselves just WHO is going to buy at 12, 15, 18 and 20p to get it there ? It is possible that the Hannam material may attract some new HNW PI’s and just perhaps, some smaller II’s. I think it is fair to say that many existing PI’s profess amazement that nobody is buying at the current ‘bargain’ price, yet few are even topping up themselves ??
My personal opinion is that if you want to see the share price move materially higher,, we need to see big II’s, pension funds, sovereign wealth funds etc., get involved."
I'll give one example, Liontrust UK Smaller Companies. They have over £200 million under management. They say:
"To achieve this aim, the Fund will invest in a portfolio of UK smaller companies’ shares, the majority of which are contained within the FTSE Small Cap., the FTSE Fledgling and the AIM indices. Companies within the Fund that graduate into the FTSE 250 Index will be held until a suitable replacement company is found."
GGP is now squarely in their target range, moving into the AIM index. Sprott invested perhaps around £2 million into GGP and we saw how it moved the share. If this fund were to invest even 1% into GGP it would be another £2 million -- but now, Sprott has taken out the shorters and a lot of profit-taking. If another fund like Liontrust (and they are not the only one) were to come into this with even just £1 million, you'd break through more resistance and leave 12p behind, and maybe 13p, even without any further news. If they put in £2Mln you'd be bumping up against 15p -- and there are other funds.
I don't think you need the big beasts to drive this SP up. There aren't enough shares outstanding for that to be necessary.
I absolutely agree that the intent with Hannam was to increase the SP. That, and the Sprott investment, has cleared the first hurdle, it's put this share firmly in the AIM 100. It will probably take either really good news or another II to take us up much, but the II doesn't have to be a big beast -- we're now in the range where a lot of smaller beasts are going to be sniffing around, and probably taking a bite here and there, as well.