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"Hi again TakingMyTime."
Hi, again. You're saying the same thing over and over and even if your argument were compelling (it isn't) it would be pointless anyway, as I said in my last post. I've run out of time for the discussion. Your posts are long and don't say anything new, so filtered.
Hi again TakingMyTime.
I cannot disagree with the sentiment in your last post, that is what is most likely to happen in such a circumstance.
And I would be likely to follow suit as well, for the exact same reasons.
We do not know what the BOD will choose as the way forward, to increase shareholder value.
We are just sitting here second guessing, pouring our heart and dreams out. And putting the argument for our case out there to be debated, dissected and commented on.
And as in any debate, a desired outcome is to win people over.
I have learned that there are people here who find that they have diminishing years left and for that reason would love to accept an offer of 80 pence - £1.
And I fully get that. Time and good health is some of the most precious things we can have. So there is a natural desire to get most out of it.
But I am in a different boat. I expect to have many decades ahead of me. And would like GGP to make those decades very comfortable for me.
I find it hard to pick the right stocks, I have burned my fingers more often then I care to count, but here I am onto a winner.
GGP will be the forever giving share (well at least for a couple of decades) if we evolve and become miners as well.
That can be outright miners on our remaining assets or through JV’s with Newcrest or other established miners. Main condition would be that we do so on better terms then our current one at Havieron.
In your last paragraph you indicate you would follow the BOD blindly.
I assume that is a truth with modifications.
They might recommend a good deal, they might recommend a fantastic deal.
But that does not mean it is the best deal possible, maybe just the easiest and quickest and yet still very good one.
But don’t ever disregard the theoretical possibility that it could suit their personal circumstances better then yours.
Selling gold in the ground can never be the best deal, there is more profit to be had.
Otherwise there would not be a buyer.
So if your time horizon is short I understand you want an offer here and now. It kind of takes the decision of when to sell out of your hand.
But if you can wait 5 years (not necessarily happily) but wait, then you can get so much more from this share.
And you will not burn your fingers on this one.
But you might on the next 1, 2 or 3 shares you try your luck with if you go out of this one.
A merger will not happen full stop end of story
Hi again Mrninjazx6
Let’s try and crush some numbers. (And hopefully get it right)
A merger with a 100:1 ratio.
We should have more then 4 billion shares in issue all in. But for the sake of argument, let’s just say 4 Billion.
Today Monday the 25-5-2020 when googling Newcrest’s shareprice: Aus 31.61
Today Monday the 25-5-2020 when googling the exchange rate AUS to GBP = 0,54
So 4 Billion divided by 100 = 40 Million shares.
40 Million shares x AUS 31.61 = AUS 1.264.400.000
AUS 1.264.400.000 / 0.54 = £678.597.158
Today Monday the 25-5-2020 according to LSE our market cap is £325 million
So £678 million is only slightly more then a doubling of our current share price.
I agree a 100:1 ratio is not going to happen.
Way to cheap.
Our assets would be totally undervalued.
I hate to break it to you, but if GH decides to sell GGP's share of Hav, it doesn't matter what you think. If he decides to recommend that GGP shareholders accept an offer from NCM it also doesn't matter what you think, it will go through. And if he decides to recommend that GGP shareholders reject an offer, it also almost certainly doesn't matter what you think. Because most PIs are going to assume that he's got a better feel for what the company is worth than they do, and they'll go with his recommendation.
If he recommended an offer of 20p, I'd accept it. If he recommended that I reject an offer of 30p because he thought it was too low, I'd reject it.
1:1 is never going to happen IMO, neither is 3:1.i think if it happened it would be closer to 100:1. But that's just my opinion of a scenario that most likely won't happen anyway so it dosent really matter.
Fingers crossed for the week.
Hi Dip666 and Mrninjazx6.
I agree with both of you.
A merger would be fantastic, especially if it could be done at 1:1, if Scallywag turns out to be the big monster we all are dreaming of. (yeah, we are allowed to dream)
Now, fantasy aside. I would be very happy with a 3 GGP for 1 Newcrest share ratio.
But truth be told, I have no Idea what exchange ratio Newcrest’s shareholders would be willing to accept.
And this is where I fear Dip666 is right.
We might be bought out way before then. It would make financial sense for Newcrest or any other major miner to make this attempt, considering the assets that we got.
But however much we are offered, we are worth more.
They have to make a considerable profit on any deal they make.
Hence why I am not keen on selling gold in the ground, but want to mine it.
Either on our own or through a JV. (but on much better terms)
If we have patience, we can earn so much more here.
In the end it is up to us shareholders what offer we will accept.
Just a thought, but what about a merger as an option? Newcrest get an exploration company and ggp becomes a mining company at the same time? Winner all round.
Hi SB, I like many here would love a scenario of continued revenue from Hav as am lucky enough to have a decent holding here so that would be a truly amazing outcome but I predict that its the least likely outcome for us. The majority of PI's out there (not posting or reading boards) will have a certain price they are happy to agree at for Newcrest to buy the remaining stake in Hav - and this is what I consider the most likely outcome for us. I suspect that Newcrest will be very adept at working out the correct price to get most PI's to vote yes to an offer. However, if we are able to continue onto Scally as oppose to a full takeover (in my mind a full takeover is the 2nd most likely outcome) I'd be thrilled to take the chance that there will more riches awaiting us based on the data and analysis we have had from the more geologically informed amongst us. Anyways - I'm going back to enjoy the weather and wish you all a lovely remainder of the bank holiday :-)
Certainly can't look at any of your lines in isolation as there are too many of them!!
Hi TakingMyTime and thanks for your reply.
First off, I don’t think you should look at that line in isolation.
Second off, I can guarantee you that there is no way we are going to be offered £20 billion for our share in Havieron.
And even if Scallywag proves to be bigger and better then Havieron, I also doubt that, that amount would come on the table for the whole of GGP in this financial climate.
And within a year.
But I would love to be proven wrong.
That would mean more then £4 a share (4 billion+ all shares in)
At such a shareprice, even I might put my mantra about maximizing profit aside.
But it does not change my view, that selling gold in the ground is selling your asset to cheap.
When you are offered just a few hundred per ounce for what is in the ground, you are so far from the true value of the gold.
I do not believe the true value of Havieron can be assessed.
Even the best MRE, will fall short.
Telfer has been in operation since sometime in the 1970’s.
At some point in the 1970’s you could buy a house in London for £5000
Today, that same house is more like £400.000 – 500.000 (and we are talking about a house not the best condition here, way past it’s prime)
So even if we got the most fantastic deal for Havieron at today’s prizes, in today’s environment, I cannot see it as anything but a lousy deal, long term.
I want as much value as I can get here.
So many shares here on AIM are just floating around or going bottom up.
This one is different, this could be a new ASOS.
And I am so thrilled to have gotten into it already and are more then ready for a stratospheric ascent.
But that will not happen if people are happy with a take over offer at 30-40 pence. (£2 Billion)
We have to wait till results are out. If Hav is a mega monster as GH’s drooling, CB’s screensaver, SB’s hubris, and Paddy’s Sats might suggest, we could be heading for multiples of today. And if, in the meantime, drilling starts at Scally and hits something big, the £1 somebody suggested may not be far off the mark.
Spot on spy.
Check the posting history.. Targets weekends and strikes up conversations with newbies that are susceptible to influence.
Various groups been doing this for months... Nowhere to be seen in trading hours.
Socialist, any chance you could avoid leaving lines unless you actually need to start a new paragraph? Last post filled up half the page....thanks :)
"It would be silly to accept a one of payment, based on gold in the ground."
This statement, in isolation, is a nonsense. You haven't said how much the one-off payment is.
What if they offer £2 billion, up front, as a one-off payment? Not enough? What if they offer £20 billion? What if they offer £1 billion plus 2% royalties? Not enough? 3%? What if it's only £500 million plus 5% royalties?
What's the CAPEX required going to be? How much? Do we know? What's the cost of financing it? Do we know? What's the 5% worth? Do we know?
How can you possibly say it would be silly to accept a one-off payment when you don't even know how much it would be, whether or not it comes with a royalty, or fairly firm estimates on the costs associated with the alternative?
Until you know what's on the table you can't possibly say this.
Hi TimberTrader, thanks for the excellent find.
My take on the article is that there is an emphasis more on Joint Ventures then on take overs.
Which would be fine with me.
As long as any future JV’s are on far better terms then what we got at Havieron.
From the perspective of being greedy and nothing but greedy, I can see why Newcrest would want the whole cake and nothing but the whole cake.
But that attitude could come at a price.
If the BOD and/or shareholders of a takeover target finds that they have been had, further down the line.
That sentiment will quickly be known in the Junior mining circles and they might not become “the miner of choice” which seems to be an important statement to them.
No it would be far better and cheaper for them to keep a Junior miner as a minority JV partner.
Better because, they will become the miner of choice, when other Junior miners see what value it brings to a company to have Newcrest onboard.
Cheaper because there is no huge upfront/buyout cost. They will not be saddled with debt.
All they have to, is being happier with a smaller slice of the cake.
In our case, they will be missing out on 25-30%.
They will still have done the deal of the century.
They got 70% of a potential Tier 1 mine for 65 million.
Even better for them, it was not money they paid to Greatland Gold and their shareholders.
The money was spent on proving up the asset.
So although it might be wrong to say that Newcrest got 70% for free, it would not be so wrong to say that Greatland Gold gave 70% out freely.
70% is a number I have a bittersweet feeling with. It is a huge % to hand over.
But if that is, what I takes to become a 25-30% partner in a Tier 1 mine for decades to come, then it is been a price well worth paying.
Especially since we have other/more promising assets on our hand.
And wont have to accept a deal on those terms in the future.
But wee need a cash generating mine to sustain further exploration.
It would be silly to accept a one of payment, based on gold in the ground.
What do we do after all our current assets have been proven up and sold for gold in the ground prices. (which are so far from the true value)
Start exploring for new assets, of course.
But that is the dangerous part, It might be 15 years again until we find something of value.
We're in a very lucky position regarding Havieron and I'm more than happy to hold and see this one through, I've already done extremely well here.
GH with his CV & pedigree, he's the money man make no mistake.
It takes 10 seconds to look through the balance sheet to realise, the company is loss making, has no revenues (apart from interest of cash) and it can only exist through share dilution of some description, including no more grants from Govt of Western Australia either. This is the reality not a deramp.
The 5% fair market value, was a master stroke by GH, it gives GGP the flexibility to keep all options on the table. If one of the options was to spin-out another company to become GGP mining, then it would only be a on "paper" company as Newcrest would do all the mining and GGP would just pay a toll. This company would be profitable unlike the loss making exploration side, and no doubt GH would be very aware of that upside advantage.
Clearly there are other options available but this one cannot be ruled out at this stage
Looking forward to MRE from Newcrest.
VS, Trucky etc, I have never argued that it is likely that GGP become a stand alone miner... But I also have never once heard GH state that he wouldn't become one, if it was the best route for maximum return to SH..
The other very strong reason why I think he wouldn't say it, is if he is telling NCM that GGP haven't got the ability to keep their 25%, then NCM are going to know that they can buy it for peanuts, rather than having to make an offer which reflects the true value, based on loss of revenue to GGP over the potential mine life etc....
It seems like pretty basic negotiating strategy to me...
Hold for Gold
I did a fair bit of research into this share helped by many on this board. My own opinion is we can certainly get quicker returns by selling Hav, moving onto scally and selling etc. However, long term and if the aim is getting into £’s we will need regular income. We don’t really have to go mining, just keep hold of a stake and cover a % of the costs. We will get a smaller chunk of the pie doing that but we would have regular income and be well funded moving forwards. That way we can leave the mining to newcrest but still profit year on year.
We have the position of power, especially if results at scallywag prove to be as good as hoped. Newcrest will want to keep GGP happy to strike a good deal on that.
Maybe wrong but my view is strongly leave the mining bit to the experienced mining companies. As an analogy, it is like putting Lionel Messi in goal for the future, well perhaps overdone but you get the hang of it.
Continue as we are please,maybe wrong but that's my view. Only change to mining if no alternative.
Just very quickly, following on from my last post, and before I go and open a very nice bottle of Australian Shiraz, there is an interesting recent article by GH which reinforces the importance of the junior explorer today in the overall gold mining picture.
GLOBAL MINING REVIEW - MARCH/APRIL 2020
GERVAISE HEDDLE - GOLD: BACK IN THE FOLD
Gervaise Heddle, Greatland Gold PLC, Australia, discusses the tailwinds driving the global gold market and says the prospect of a 'production cliff' is once more putting exploration under the spotlight.
If you haven't read it, it's very interesting in this regard, or, if you haven't got time, just go to the conclusion at the end...
The view of GH on this subject has generally been one of whatever works best for the shareholders, and looking back at my research, he did state in February 2019, that "if it makes sense for shareholders Greatland can take it the whole way - exploration, development, feasibility to production." That said though, the general impression you get is that he'd prefer to be the explorer, and that that's where he can get best shareholder value.
Thanks Trucky, good to know. And edging towards a billion quid. Part of the reason for highlighting this is so people reading do much in to NCM capital raising can see they prob don’t have enough cash if a takeover is in mind, with all their other opps and commitments. And that, for me, suggests a more symbiotic relationship rather than a buyout.
the doors... thats us$ not au$