If you would like to ask our webinar guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund a question please submit them here.
London South East prides itself on its community spirit, and in order to keep the chat section problem free, we ask all members to follow these simple rules. In these rules, we refer to ourselves as "we", "us", "our". The user of the website is referred to as "you" and "your".
By posting on our share chat boards you are agreeing to the following:
The IP address of all posts is recorded to aid in enforcing these conditions. As a user you agree to any information you have entered being stored in a database. You agree that we have the right to remove, edit, move or close any topic or board at any time should we see fit. You agree that we have the right to remove any post without notice. You agree that we have the right to suspend your account without notice.
Please note some users may not behave properly and may post content that is misleading, untrue or offensive.
It is not possible for us to fully monitor all content all of the time but where we have actually received notice of any content that is potentially misleading, untrue, offensive, unlawful, infringes third party rights or is potentially in breach of these terms and conditions, then we will review such content, decide whether to remove it from this website and act accordingly.
Premium Members are members that have a premium subscription with London South East. You can subscribe here.
London South East does not endorse such members, and posts should not be construed as advice and represent the opinions of the authors, not those of London South East Ltd, or its affiliates.
In matter of fact I'm not Helpful even owns 3% here. Not mentioned on the RRR list of significant shareholders.
Care to provide a link to any holding RNS of yours Steven?
It would be somewhat embarrassing after all this hot air and fluff and bluster if you weren't even a significant holder of shares.
.
Dukey old chap when I have previously suggested that you couldn't read I was half joking: I now see I over estimated you.
This was the RNS on the renewal of the CLNs
https://www.londonstockexchange.com/news-article/RRR/renewal-of-convertible-loan-notes/14353031
12% coupon, 1% per month. Understand now?
PS this may be of interest re FSX and RRAL
https://www.youtube.com/watch?v=0lCyLYsBEe8
So by continuing to hold I materially improve my position.
Lets suppose my target is 2.5p and that I converted and sold in January 2020 at 2.5p, I would be getting materially less than doing the same in December 2020 because of the interest accrual.
When investing you should make sure that you understand what you getting into and that you apply proper decision making: emotions just get in the way, do the numbers and then decide.
The critical thing here is, what is fair value? At some point this will go to materially in excess of fair value: it is just what happens. At the moment everything that RRR is involved in is doing well. The fair value is going up day by day: gold is up, iron ore is up, manganese is up, copper is up and cobalt is up.
I can see RRR being materially higher in December, why would I sell now?
DYOR
read this Dukey old chap, this is called analysis....
Helpful Premium Member
Posted in: RRR
Posts: 7,964
Price: 0.555
No Opinion
RE: RE: Convertible Loan Notes06 Aug 2020 12:12
As an example of how to look at the decision making on a CLN: lets suppose the CLN holder has £100k in the CLN and that the coupon is 12% and that the conversion price is 0.6p and it expires on 19/12/2020.
Monthly interest is £1,000; converting at 0.6p gives 166,667 shares per month.
Lets suppose my target price for exit is 2.5p. Then for each month I hold the CLN then I make £4,166.68 per month that I hold.
From 19/08 there are four months left. If I converted flat now and got my money back that would be one thing but if I held I could exit at 2.5p then I have given up 4 x £4,166.68 x 4 which is £16,667 on £100k on early conversion. So I would be giving up a return of 16.67% between now and December. Any CLN holder who thinks that they can exit in December at 2.5p would hold because the accrual of interest materially improves their position.
So it come down to down to a few things: is there any risk that the CLNs plus interest won't be redeemed in December, what is the price likely to be on conversion, what is the fair value calculation once Migori has been reissued, DRC progressed, Victoria progressed and the iron ore assets progressed.
We are in a metals bull market and in particular in the metals that RRR is in: only someone who really needs the money or has a much better transaction to rotate into would convert early. Now if RRR spikes hard and I think that it has gone way over fair value, then that is a different matter. However, I don't see that being an issue before October. If we spike hard off the back of the TSX listing, the ASX listing and progress on DRC then it would be time to sell.
DYOR
The M word again.... Try reading something..
The Kenyan Mining Rights Act 2016
http://kenyalaw.org/kl/fileadmin/pdfdownloads/Acts/MiningAct_No12of2016.pdf
See section 30 Mineral Rights Board
https://assets.kpmg/content/dam/kpmg/ke/pdf/kpmg-mining-act-2016-analysis.pdf
"The new law defines elaborate application processes which require extensive review of license applications and supporting information by both MoM and the Mineral Rights Board.
This requirement extends to all modifications or changes to licences and permits. It is the
intention of the law to lend both transparency and decentralized decision making, but this
comes at a high administrative cost which might in the end lengthen approval processes and
undermine the intention of promoting investment in the sector. "
The Mineral Rights Board made a recommendation that the licenses be reissued to RRR in September 2019. https://www.londonstockexchange.com/news-article/RRR/update-on-kenyan-interests/14232628
"Red Rock is pleased to note the approval for the grant of licenses by the Mining Rights Board (MRB) on the mining cadastre website. Upon receipt of official confirmation of intended grant, the Company will be invited to fulfil fee payment and registration requirements. The grant of the licences remains subject to the approval of the Cabinet Secretary and a further announcement will be made as and when the licences are confirmed."
The Mining Cadastre is here... https://portal.miningcadastre.go.ke/Site/CustomHtml.aspx?PageID=d7f3f61d-4689-4280-a59a-b865f002dd60
If you did some reading you would know that what you are your little gang of trolls is going on about was and is complete drivel.
DYOR
Wasn't there also a problem about the protected rights that the local population have to explore the mining tailings?
Zumore - "So even though a certain person on this thread makes out it's just a simple process of the Kenyan government signing off the final piece of paperwork."
Yep that certain person has been saying another licence is imminent since 2018 as I posted last week with all his lame ramps.
Zumore - "I actually suspect Red Rock first have to prove they aren't just time wasters and that means proving that they have the money to build a mine."
I would totally agree. It's generally a requirement for any mining licence that you can demonstrate your financial and technical ability to do the work. Some years back, when RRR had applied for 3 exploration licenses for the Ivory Coast project I posted up Bloomberg news article that covered this topic. I have a copy of it in my archive, here's the link. The article is from 2013:
https://www.bloomberg.com/news/articles/2013-04-22/ivory-coast-sets-minimum-investment-level-for-prospect-licenses
It suggested that a company had to demonstrate it had significant financial capital to be able to undertake the work.
RRR never did get those 3 licenses awarded afaik.
In 2016 a new Mining Act was passed in Kenya.
There's a useful read here about mining law in Africa. The final sections about disputes are interesting.
https://www.nortonrosefulbright.com/en-us/knowledge/publications/8664762c/mining-arbitration-in-africa
from 2015:. https://m.youtube.com/watch?v=ktKeoqqNBDI
You can see back then that the Kenyan mining minister Najib Balala was positively scathing in Red Rock's abilities, saying that the £500,000 that Red Rock had just raised was peanuts and was insufficient for exploration work and they couldn't even build a tiny mine with that small amount of money.
Also notice in video were he says RRR will have to prove that they have the money to get major exploration done and a mine built.
So even though a certain person on this thread makes out it's just a simple process of the Kenyan government signing off the final piece of paperwork. I actually suspect Red Rock first have to prove they aren't just time wasters and that means proving that they have the money to build a mine.
Also notice in the video they mention Kansai mining. Look at this June 2018 RNS and all the money RRR said they would pay them if licences were renewed or reissued. https://www.investegate.co.uk/red-rock-resources--rrr-/rns/progress-report---african-exploration-assets/201806150700024789R/
Everybody can watch the video, read the RNS. I don't think it's a certainty as "helpful" makes out.