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 and have access to Premium Chat. 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.
I would like to add to my last post, that the company that receives a formal bid, must send a formal letter of rejection within a certain time period, outlining the reasons the bid has been rejected.
Many reasons can be given, for example not in the best long term interests of current shareholders.
It can also be rejected, as the value of the bid, is too low, but evidence must be supplied as too why.
Afternoon gents. You may or may not want to do this... but over on the ggp site there are some links to the western Australian bureau of mines (think that’s what it’s called). Lots of depositions from newcrest for all the supporting dox they have to submit to get a mining licence etc etc. Now it’s quite likely that Ecuador aren’t so rigorous in what they want to see, but who do you think is capable of this level of work in solgold?
I expect that your answer will be we will hire in contractors to do this? Anyone in mind who has the knowledge of Ecuador, language, culture, mine construction, ecological effect etc etc etc??
It’s a substantial body of work, to add to the pfs, dfs etc, which they are struggling with at the moment.
This is a debate we have had many times Aquinaga, any approach and any bid can be rejected.
However if we receive a documented formal bid, for me the position is unclear. I believe silly bids could be rejected, by the BOD, as these cost time and money.
However if a bid is rejected, then the company bidding can go hostile and place a bid. ( they can go hostile at anytime )
However if I was the company that wanted to buy us, I would want to be sure that some of the larger holders of Solgold stock, would accept the price for their shares. ( So I would talk to them )
A lot of this is based on what constitutes a formal bid.
For example if I offered 2 million pounds for the company, I am pretty sure my offer would be laughed at in the Boardroom, and would never see the light of day.
For arguments sake if an outline of a bid for 50p had been received already is that still low enough for the board not to publish it?
IE. How much higher would it need to be to be taken serious for the board to publish the approach?
BNC, a bit but I am only 45!
It's certainly normal to wait for the PFS, but I would have thought enough info is available for a cheeky lowball of say 48p at least.
Don't disagree Iceberg, only because the way a low bid would work, No one sells their stake until it get's to a level that the large stakeholders will sell for.
Just no one wants to put that much money on the table.
Hi BNC, I know your question is not aimed at me.
Too many on here stated that we would get a bid at PEA, some even said before PEA.
Many on here have said we will get a bid before PFS, they will change their minds after PFS and come up with another excuse.
Some said the Franco Nevada deal would never happen it was a bluff to get a bid. That never happened.
I think you have a point when you say no bids before PFS, but maybe no bids before DFS or maybe buy it after it's built.
The good news is, as we go along, we become worth more at NPV, and after we build it, NPV and Market, will hopefully close the gap.
Theiceberg I find it unbelievable Kylie jennet can sell half her cosmetics business for over 1B
And we are only worth 0.75B
Just showes market sentiment is the biggest price driver imo
morning - the iceberg
you've been round a bit
do you think an offer would be made without the pfs as a minimum?
Oh I agree quady, but some trouble making ceo, could throw in a cheap bid to cause trouble or even a lowside real bid to make BHP newcrest or whoever over pay.
If you want it but can't have it you may as well make your competitor pay more money for it.
Iceberg, the reason I believe we have had no offers, is because, whereas NCM and BHP may wish to depose NM, so they can try a cheap bid, in reality they are competitors, so any bid has another problem, any large stakeholder and the majority of PI's know what their shares are worth.
So if BHP chuck in a 1 pound bid, not only would Tenstar, DGR, NCM, Blackrock, majority of PI's and others vote against it, as NCM want's a larger share, not to sell their shares.
As I have said many times, the diverse book gives us our first line of defense.
I hope we get a nice large PFS, as any bid would have to be higher, and as we don't have one now, really unlikely we get a bigger one after PFS.
Yes they can reduce the 1% to 0.5% or 1.5% to 0.75% NSR and from recollection I believe they have until around 2028 to pay Franco back before this option expires so in actual fact it is probably highly likely that they would try and pay half of the monies back and only end up with either a 0.5% or 0.75% NSR so all this bleating by BHP / NCM is just rattles out of prams as the Franco deal was a stroke of genius by NM preventing huge dilution for small investors and stopping the majors getting yet more shares on the cheap and perhaps most importantly stopping them from getting a firmer stranglehold on Solg so hats off to Nick!
3 companies Franco, Newcrest, BHP all wanting to finance alpala with a combined market cap of over £150bn.
I am sure there are others, inc smelters, copper traders who are happy to help fund £2.5bn of capex...
Yet our market cap is only 750m...
Tbh I find it strange that even a lowball offer hasn't come in (not that I think it will be accep ted), but Nick and ingo must be thinking about a Jv...
That's correct Colonel, they can reduce the 1% to 0.5% NSR for the Franco Nevada deal, I forget the details.
Can't recall the exact detail on Franco deal but believe SOLG have the right to by back xx% of that royalty deal so whilst annoying for BHP, I think at least half it it is available to be clawed back for a cost.
Lots of exploration holes/metres to be reported and I hope NM maintains the regularity of these updates now that the AGM hurdle has been jumped.
That said, the next few weeks are going to be hard to gauge based on quiet periods. Under normal conditions, if SOLG go quiet on drilling, then it normally means they have nothing crucial of importance to report. However, with clear issues on major holders and potential hostile moves, it may make sense to keep some cards close to the chest. Whether that's PFS delays or exploration update delays.
Just to throw a curve ball in there... could Rio already be underway?? The last update on this gave the target date and perhaps it hasn't slipped at all? Perhaps they are into hole 1 or even 2 by now but not hit anything worthy of an RNS?
The y should be able to do it as part of steralisation... They need to know where the mineralization is so they can decide whe re to put the infrastructure...cough cough...
Morning Iceberg, something I am unsure on.
If we take the extra 50 million, isn't it for Alpala only, as if we have any of the 100 million left over, we must use it for Alpala's construction.
Schlemiel, please don't misquote me.
Also I don't think what you say makes sense.
I brought in at 4.6 pence a share, when we had 600 million shares in issue.
We now have 2.072 billion in issue at todays current price.
So a further dilution doesn't mean a drop in price.
Remember that's how exploration works.
The Alpala project going to construction, needs a PFS and a CFP, let's see what Ingo comes up with.
The reason I have said we go to production, is that given the facts, it's the most likely outcome. ( nothing to do with what I want )
Going to production, is how you as a PI get the best return for your stake.
Once we have the PFS and the HLD and LLD is done, and we have a CFP in place, the only risk is that CGP don't pay, their share. But that just means we get their 15% for a bargain.
If anything going to production means less risk and less disruption.
Yes we get some dilution, but as the beginning of this post illustrates, dilution doesn't mean a lower price, quite the opposite.
Highly likely they will take the extra 50m imo, the official reason will be the extra drilling at tandayama and the expected 1000m of excellent high mineralisation, which will need a 3 rig drill campaign. Then the extra designs needed.
I equally think there will be an investment by Rio tinto.
news on the Rio license
News on pad 3 porvenir.I
News on hole 4
News on hole 5
But news on the new investment maybe first.
It would be nice to see what McDonald (CGP) described as 'competitive tension'. Most on here won't be around when Alpala comes into production so most I am sure want to material rewards before this event rather than after. Evidently Quady desires to go the entire full distance that will expose his investment to further dilution, further disruption and elevated risk. I don't wish to see anyone's investment become more riskier than it already is
Come on Saint Nicholas, get yer sack out and let us see the contents contained within
Agreement for another $50m ends in 3 weeks.
11 May 2020 – 11 January 2021
This is literally slipping away from BHP before their eyes and about to get worse for them. Not much they can do now apart from make a bid.
Question is... will NM take the $50m or will the next RNS on this say it's been raised to $100m option with end date of May 10th?
That all said, the way the exploration folio is going, Alpala is potentially no longer the jewel in the crown... so BHP might not be too worried about Alpala and have eyes on Porvenir. But hang on a mo... didn't NM give the Chinese a small stake based on Porvenir drilling. mmm. Looks like BHP might not get a look in there unless they offer a serious wedge.
All NCM and BHP had to do was offer $100m at a fair equity price eg 45p+ but instead, they tried to hammer smaller shareholders with an equity issue that woud have seen over 20% dilution.
Now look where they are. Sometimes, playing ball and being fair is the right way to go when you have afoot in the door to one of the worlds largest gold and copper systems.
I do hope the next deal involves Barrick and or the Chinese. Give Barrick 5%+ for $75m funding. With lock in (like the previous bhp's). That might be strategically better than $50m from Franco and $25 for more exploration from Chinese?
And before someone grumbles about dilution... trust me... A headline that says Barrick takes 5% of SOLG at 45p or 50p a share will do more for the SP than an extra $50m drawdown from Franco and it would put the majors in the fighting ring for all to see.
ColonelD - I share many of the sentiments you offer in your last post.
Why did BHP not take up their 37p options prior to the AGM is the most interesting/intriguing point made on this BB since said meeting. Certainly in retrospect it appears the most monumental gaff. Was it sheer arrogance/confidence that they had the numbers? Could it have been they left it so late before deciding to go hostile that it became a timing issue (though if so this makes the decision look even more rash and ill-judged)? Did they actually get a bigger share of the PI vote than most of us assume and one of their II partners let them down?
When you ask what have they got to lose by putting in a hostile bid now? A low early bid of 50-60p might actually be helpful to push on the share price but I don’t think it’s going to happen just yet. I think NM’s counter would be to immediately publish the PFS (which I suspect is in fact ready and its current delay is merely a defensive move to frustrate BHP/NCM & buy more drilling time) making any lowball offer look exactly that. The result would almost certainly be a bidding war. I doubt very much BHP want to initiate that.
Welcome aboard Gold Tinsel, first post I see. Can be a disruptive boards sometimes , just to warn you!!
So you now accept there will be further qe but say other factors will push greenback up?
I would say if BHP take the options it pushes the sp up , big time. They are still in a position now to make a low ball offer , and take out at circa 55p.