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KRSS, If you can decipher the below I will bow to your superior knowledge. !!!!
The group’s share of pro t generated by IRC is US$52.7million, including US$23.6 million effect from partial reversal of impairment
at K&S mine and a further US$21.4 million reversal of impairment of investment in IRC (2019: US$(12.0) million share of losses
generated by IRC and a further US$23.4 million impairment of investment in IRC). Following re-classi cation of 29.9% interest in IRC as assets held for sale, the group recognised a US$55.8 million write-down to adjust the carrying value of net assets
of disposal group to fair value less costs to sell. IRC contributed US$25.0 million to the group’s Underlying EBITDA? in 2020 (2019: US$10.3 million).
KRSS. I understood it that IRC owed Gazprom bank money not POG
Rusty, I am trying to teach for almost a year, ok once again open annuals report page 58, EBitda by segment, Last year IRC contributed $25m to POGs ebitda ,, IRC’s ebitda was 80m, and 31% makes $25m. Now if in 2021 irc ebitda is $400m, POG will receive $125m. Guarantee fee is separate
KRSS why would be receive that ????? we are a shareholder ??? If Pog makes money we don't get a share, Don't understand ??
Fresh calculations? If IRC stays with POG , and irc achieved $190 per tonne average sale price , POG will receive $132 m from irc as of its 31.10% proportionately. My only confusion is whether it will come after cost of sales or even further but many chances it’s ebitda.
Palladium, IRC’s 31% EBITDa is attributable to POG because of irc being its associate if remember this accounting treatment correctly. High shares valuation is on top of it
Correction, POG will receive $70m this year from irc but will up to year run
Many chances IRC will stay with POG, stocken has to arrange cash until 25th August, even then POG can refer it to note holders, above legal challenges also there to stop this transaction. 7 months already past, on proportionate base , POG will above $ 70m this year from irc , POG’s revenue will still fall around billion dollar but profit high. All IMO
Palladium one what is the IRC value at the moment. I woud suggest its nowhere near the values you are quoting.
As for proving you wrong, Why would I ant to do that when I have agreed from the outset it is a bad deal !!!!! I wish there was a way to stop it. But, I am not going to continually have the same conversation when we are in the laps of the gods.
No, Rustybucket, it is bad thinking. Take a look at comparable companies. Let's not speak of BHP, Vale or Rio Tinto. Let's take Ferrexpo with iron ore in Ukraine. Ferrexpo last yeat produced 11m tons of concentrate. Roughly, four times that of IRC. The market cap of Ferrexpo is 2.85Bn pounds. US$4B. IRC, based on this very simple approach, should be worth (EV) around US$1Bn. 30% - US$300M. Okay, US$250M. NOT US$10M. See if you can prove me wrong.
Two more points: (1) of course, the bondholders will approve, why do they care. Particulary now with US$136M worth of bonds beeing redeemed with Gazprombank money. What a coincidence. (2) Of course, Stocken will raise 10M against the asset worth 25 times that amount. A schoolkid can do this.
Also a bit galling that they are testing freight traffic on the Amur bridge. All these years of waiting for it to cut IRC transportation costs and the benefit could pass to another entity at a bargain price just as it becomes operational.
palladium one, this is at the time. Who knows where the Iron Ore price is going. IRC in the past have a history, of not making money. The current share price doesn't suggest they will continue to be making that amount of profit. But whatever the share rice, or profit I have said for over a year that I think its a bad deal. Unfortunately I don't see what we can do about it. At least Lawrence13 has written to the company.
There was some mention of the bond holders being able to block it, not sure if thats the case, Hopefully, Stocken can't find the funds.
I think that a lot of people do not understand the size of the theft that is happening. IRC made US$66M over the first four months of 2021. At this run-rate, annual profit is $200M. US$.
Now, at a very modest PE multiple of 5, the EV of IRC is US1Bn. Less US$174M of debt. The equity value is thus $825M. 30% of it ~ US$250-270M dollars.
Now, the 30% block is getting sold 25 times cheaper that it ought to be.
Think of this.
Lawrence13 Of course I would agree that Things were not as good a year ago, for IRC, I would e a hypocrite, If I didnt , it was still doing better than it had for years, though. I remember having a conversation with Kenj and agreeing with him that I did not think Gamprombank would release the guarantee. How wrong was I. You mention would it be the same if Hambro and Pavel were here, I would say of course it would be , because it was Pavel who agreed to it. As far as I can see it was a legally binding contract providing certain conditions were not.
Hopefully Stocken, whoever they are, are liked to Pavel, and they can't get the 10m, but I won't be holding my breath.
You raise an important point Freddie. Why did the deal take so long. When Strukov and Everest staged their coup the management that set up that deal with stocken were essentially kicked out with Pavel in the chokey before Christmas. Let's sat things had remained the same and Pavel was still the CEO and Hambro the Chair; would they have continued with the Stocken sale?
Tbf rusty no one knew how the fortunes of irc were going to change , and put the boot on the other foot the buyers only signed the deal now because of the increase in value , why didnt they sign it last march ? It looks like a very one sided deal to me
Yes lets put it to the share holders to vote. Great idea
Rusty: would you agree that at the time of the IRC announcement im march 2020 that thing for the company looked a lot worse. In fact I think it left most with no opinion at all at the time
They are the ones who are claiming Pavel is a criminal, they had him incarcerated and then backed that up with the half finished KPMG report. So that in mind they obviously have every reason to appeal that the deal with stocken s off. lets face it they are totally for the sale of the IRC 29.9% sale if not they would be fighting its implementation all the way on behalf of the share holders
Where were you all when this deal was announced ???? There were only a very minimal minority against the deal. In fact Retired Banker wanted it gone so badly, he was so happy about the deal he said he would give it away.
Now when the gates are open and the horse has bolted, you complain. In my opinion this should have been put to a shareholders vote, and Lawrence13 your tone on Pavel also seems to have changed ???