Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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If we stay with a market cap of around 50mill and the full 500,000,000 shares get issued, we are looking at a SP of around 7p. If this is the case any profit I was thinking could be made is seriously reduced.
I dont see how that is in the interest of current shareholders.
I'm praying one of the other avenues of funding gets exploited!
Tivman, the most basic and accurate means of assessing current value is "willing buyer, willing seller", and on that basis the price is 25p. Ganfeng negotiated with the company and the company was prepared to let them have the entry price of 25p. It doesn't matter what some analyst says, the proof of the pudding is there in plain sight.
Value will come and it will be considerably in excess than the current sp, but there are still significant hurdles to overcome. That explains why the market prices the company at the current value.
The key with funding is if Ganfeng take up their extra 22.5% Sonora allowance. If they do this, then funding will happen without being too bad for current shareholders. If they don't, then I fear the dilutive aspect could be detrimental as we struggle to build a decent mcap. By the way, I understand long term vs short term on dilutive aspect giving away 22.5% compared to a one of equity, but at this point having funding that isn't too dilutive and still owning 50% of Sonora has to be the target.
Might some of the 'headroom' being voted on, be towards investment needed at Zinnwald?
Today’s rns gives the company the option to raise funds via placing or rights issue
This does not mean this will happen or to the full amount
Also can you point out where the company and ganfeng have said they don’t think. The company is undervalued?
Hasn’t the company in recent rns actually said they expect the gap to close ? Or do I have it wrong
MikG, QED.
I rather suspect I've been in and around this share for an awful lot longer than you. I have witnessed the ups and downs...the broken promises, missed deadlines and general inability of management to be crystal clear. In other words, a very typical AIM scenario. Throughout the past five years I've been consistent...I rate this project and believe it has a great future, but I'm also fully aware of the difficulties involved in getting it going. And although I'm not currently a shareholder (although I'm not sure that makes any difference whatsoever...discussion is what these boards are for), once the details of the full funding in place, which looks like being six months away, I will likely re-invest. This explains why I keep a close eye on the company.
As for this being a reiteration of the funding gap, the point I was making is that many people have failed to understand what's being said by the company, and I've seen some pretty daft comments about how little is required.
I know you think the company is undervalued at the moment and you have consistently said the market is wrong. I disagree with you, and so do Ganfeng and the company. Value will out, but not yet.
You seem to believe I should simply go away and shut up until I've reinvested. Well, sorry, but that won't be happening.
Agreed with the sentiment of other posters this morning. Addict.. Congratulations on having the fans who welcome hearing the views of someone not even invested, but I generally smell a rat in those scenarios. Seems odd to me that your consistently first on the scene despite not having an investment here. Also seems odd you wanted to draw attention to the funding discussion, which is a reiteration of and referral to the exact numbers previously outlined! (Hence the “funding gap as discussed in feasibility study” chit chat in the rns itself). So I don’t know what’s new and you think people need to read. This is the same news the share price has been punished for for some time now.
You also seem hesitant to note that this minor funding gap is the final part of the puzzle to unlock all the value of Sonora! So it’s like giving someone £2 (yes a negative in taken in isolation) to receive £10 back.
The company post AGM resolution will have every option available to it to unlock the bullion plus NAV of Sonora. As ever I feel this could be handled better, and has parallels with the past horror funding raise. But I can’t change the board and how they go about their business.
adv, thank you, that's very kind.
I'm afraid it's a feature of these boards that, when confronted with facts they don't like, some people tend to go into attack mode, which I always find very odd, given it's essential to be objective when investing.
I have a reasonably large shareholding in SOLG and am hugely positive about it. However, whenever in the past I've raised some very legitimate concerns (which have now been answered), the ruckus it caused was immense.
The greatest problem we face as investors is trying to interpret what management are telling us. Invariably, they attempt to obfuscate (SOU is a prime example) and mislead...and they get away with it. We must probe and prod until we get to the truth.
On this occasion, the company has given the truth and has clarified some of the misunderstanding that has beset private investors. This announcement is to be welcomed.
For the record, I welcome addicknt's opinions. Always the most honest whether he is invested or not. A true rarity on LSE.
the higher the amount to be raised the better isn’t it...
$100m / 500m = $0.20 min/share...
$200m / 500m = $0.40 min/share...
$500m / 500m = $1.00 min/share...
I was not expressing an opinion...just stating the facts. And yes, headroom is necessary and it' sensible to seek approval now rather than to wait to have it approved via special motion at an EGM.
There has been a huge amount of debate on here about how much funding is still required; this announcement clears-up the discussion, which is to be welcomed as it puts the speculation to bed.
For those who want a more balanced perspective than someone who has just sold their entire holding (or a current holder for that matter), it should be read thoroughly and the context appreciated. What does anyone really expect going into funding negotiations? BCN would have a clearly weakened hand in any discussions if they were not able to self finance, so this headroom is necessary to allow them to be in as strong a position as possible. Non news.
by the way, it clearly sets out the total funding required, and it is not insignificant, as some people have suggested.
just announced for the 12th Dec...election day.
The motion allowing the issue of additional shares is worth reading. Dilution will accompany the fund raise and shareholders are to be given the opportunity to subscribe for £8m...the same as in the abortive placing.