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There also remains the big question on whether it will be Nic assets (subsidiaries) that get sold off, or a deal is made for the whole company. I suspect we are still in an asset sale scenario, but an offer for Condor itself could still be a possibility. Could a Chinese entity reverse in to Condor and obtain a listing in some way? Would it be of value to them?
This morning's RNS stated the following:
''The Company is in discussions with other shareholders who have expressed interest in investing alongside the Chairman and largest shareholder on the same terms, notably, via a small placement of new ordinary shares at £0.15 per new ordinary share. An update will be provided shortly.''
How can the company offer new shares to certain other shareholders at the price of 15p when the company is negotiating with two bidders. This can't be allowed when the Senior staff have inside info. Please discuss...
He underlines the point that most of the world couldn't really give a toss about some targeted U.S. sanctions on Nic. The Chinese are canny investors, but I'm pretty sure they wouldn't mind giving the U.S. the middle finger on its sanctions. I doubt the (several) Chinese embassy meetings were of a social nature. My only question would be if the two parties they are in 'advanced discussions' with are both Chinese. Would the embassy trying gaming the auction if its two of its own bidding against each other? It might be difficult to game it very closely but they could set the the (bidding) ball park numbers.
He does look both enthusiastic, and frustrated, (at the absurd marcap) in equal measure. A 'new year' deal looks possible although that could be weeks into January, maybe February. Whatever, expectations have certainly be set on a deal being pretty close. I wonder how long it will be before the wider market figures our that there is at least a one bagger, maybe two, three, or possibly even more on today's closing price? And not that far away.
Any guesses as to the closing share price on Friday 29th December?
I have similar logic to you dictum, but with an average now of 40p having been buying all the way down for the last 10 years. I even bought some at £1.30 on good drilling results, the heady days. It has been very painful, but I have confidence that I will end up making a profit, especially with gold at $2000.
The consolidated balance sheet at June 30th stood at nearly £43m vs. £30.5m marcap today, so we need 40%+ increase in the SP just to reach book value. In other words circa 22.5p to reflect the costs of getting to where we are (I'm ignoring any very recent changes to shares in issue for this back of the envelope stuff).
Neither reference is particularly useful when trying to work out what the exit price will be, but they do give you a sense of context. The only really useful reference is the projected NPV which, as has already been pointed out, has a pretty strong correlation to PoG. Which happens to be on an upswing at the moment and seems to be happy settling above $2000.
I haven't attempted a new NPV calculation but it should be well north of $425m. Let's be conservative and say $500m. Now I'm a buyer, am I going to embarrass myself by slotting in an offer below book value? Even the bare faced low ballers are unlikely to attempt that. However, I'm probably going to want a minimum of 50% discount to NPV, and some. For me the playing ground will be between $100m and $250m. I doubt we'll get $250m just as much as I doubt JM will accept anything around or less that $100m. However, I look at it I still keep coming back to somewhere around $150m, say £120m, or somewhere between 50p and 65p based on what your assumptions are about fully diluted and FX on any one day. A month ago, on one of my more pessimistic days, I was thinking 35p - 45p, although the news of two active bidders increases the chances of something closer to the 60-65p marker I thought we might get a year ago.
As ever we remain in a world of guesswork and speculation. Nonetheless, today's RNS has reintroduced a bit more optimism about the outcome, and knocked for six the people who seem to think that an AIM, small volume share price, sets the reference point for a valuation. In a FTSE 100, high volume trading environment, it certainly remains of key importance. But this is AIM, and Condor is a speculative, almost illiquid, junior explorer/developer, which lurches from one cash raise to the next, and from one RNS to the next. And MMs are more than happy to knock a penny off to trade 300k shares - it's their job.
The warrants exercise is also a strong message to bidders that if they think they can wait out until Condor runs out of money, JM still has pretty deep pockets. I reckon he doesn't want to own all of Condor but still wants a pretty solid return on the time and money he has already put in. I just can't see him settling for less than a 100% return, and probably more. Double your 22.5p (to reflect sunk investment cost) gets you to 45p, add a bit more and you start moving into my exit price zone expectation. I bout 200% is on the cards but you never know.
I'm just sharing thoughts. I've no more idea than anyone else what the final SP equivalent outcome will be. But I still remain a bit more positive than negative. Why else would I still be in it?
Hello broomtree....in at 11am and out nearly 4 hours later ...with my 18,888....chump change but better than Harl!
ATB
Well at least that woke everybody up… hope edging up…. But been there before so will not be adding
A very very positive interview, we can relax, this is not going to be sold cheap underneath our feet. Happy days ahead, and the hint was, not over the next two weeks, but early in the new year a deal will be announced. ‘We are absurdly cheap currently’ MC says, and I believe him.
Simms, pretty sure the NPV number of circa $600m at $2000 gold was based on the larger resource/PEA. Either way, we've got a bit of catching up to do with the disconnect.
At current gold price we must have an NPV over $600m and this is only the base case excluding Mestiza and Americas pits. All Jim is doing is standing firm on the level of discount he is willing to offer as we are worth today a tiny £30m, barely 50% of what has been invested in the mine over last 12 years. Even a triple bag from todayis a big loss to investors due to cost of money over this 12 year period. The share price is so far removed what is being discussed as an asset sale. Obviously the share price is a huge distraction and i suspect a serious value could be achieved more readily as a private company but it sounds very firmly we are into the final straight. Longer than expected but a decent exit for investors and a probable 3x from today.
Yes that is a decent interview and particularly interesting that he is meeting people at the Chinese embassy out there in Nic. It seems most likely that the binding bidder (if there is one) will be the Chinese company that did the site visit. You never know we may see some action in January!
Well listening to MC has cheered me up enormously, probably the first time in what seems ages that i feel there is a high possibility that there is an end to this nightmare.
I might be totally wrong, but MC comes across that Condor is close to be sold, he was about to say " very " close to a deal, before changing to close.
It's looking like the Chinese then.
That's the most coherent I have heard him speak - he looks almost excited
Trying to put a negative spin on things? Lol!!!
People here are excited as if the assets being SOLD,
Don't want to ruin the party but it's important to stick to the facts RNS with absolutely No NEWS There's nothing we didn't know other than vague wording about having "advanced talks" God knows what that even means
What we do know
A. JM has likely invested over £20M in CNR over the years however total value of his shares worth about 6.5M , A failed investment by all accounts , (and this is without calculating inflation, etc.)
B. JM must inject money to ensure sufficient financial runway apparently there is no other idiot who would do it so he has no choice
C. After the current dilution, he will hold over 25% so is getting very close to "takeover" point.
D. The one who is diluted is us,
E. If we continue to receive exciting news like "advanced talk" within a week, SP will Will crash again.
Conclusion JM just buying time to save his investment the only way he can do it is a low SP, takeover and sale of assets as a private company Today's news is just another step in that direction. And the joke as usual is on us, GLA
The spread has really tightened from this morning. Looking promising, and the reason why the other directors want to subscribe for 15p.
I particularly like the sound of
“until a desired price is achieved”
Which sounds pretty confident. Certainly feels like a triple bag in-waiting for those looking to invest until at least the early year and with gold price ascendency and interest rates set to drop quite quickly next year buyers i suspect will be also looking to tie this up before market changes and asset prices rise.
Finally something to comment on as we have actually had an update. The sales process continues and there is very important new information in the RNS:
“ the Company is in advanced discussions with 2 gold producers”
And
“ Jim Mellon, Chairman of Condor Gold, commented:
"I continue to be impressed with the asset sale process. We are very aware of the value of our assets and will maximise value for all shareholders. My investment of a further £1M is designed to ensure sufficient financial runway during the sales process until a desired price is achieved."
So a very clear signal of good progress with those advanced discussions and Jim providing another £1 million by exercising his warrant at the same price as the last placing, to ensure there is a sufficient cash runway to get to his desired sale price.
There can be little doubt that his desired price is multiples of 15p and the share price should now start to rise back towards 30p as we await further news. The last 12 months have been difficult for all junior gold companies and indeed resource companies generally. The recent strength in the gold price which looks to be sustained has to be a very positive factor for the advanced discussion as gold is now above the gold range used in Condors original sales pitch and BFS. CNR’s gold is considerably more valuable than it was 12 months ago and when that is plugged in to the valuation it becomes very attractive. If it was a 12 month payback period on the original figures how much less will that be on the new figures which will rise exponentially.
Stock exchange was having problems earlier, nobody could trade small cap shares. Maybe a bit of a knock on effect.
Tried a few of my small caps and can't trade on ii.
Given the past few months, it’s a positive update coming out of Condor today.
JM is so upbeat in his statement considering but guess he knows more than us!
Great entry price for risk and reward here but for me I will just stick to what I hold as don’t want to over invest. Now let’s hope we get some concrete offers in soon!
Tried IG and Interactive Investors ...neither quoting or allowing orders....whats going on?
Two - sorry fat fingers
Interested parties to create a bidding war, hopefully.
You never know once an offer if confirmed the other companies who made non binding offers might break cover and join in.
Threesome anyone?
Cornetto- how can we be valued below our market cap... our market cap is our value?