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Good to see it completed.
RNS - fund raise completed, as easy as pie.
I assume this raise means dilution for existing shareholders , is the raise good or bad news for us?
Thanks for the input guys, if they've held since 2017 then they are heavily down on their investment
As some insight I feel it may be an audit oversight as Cora's website currently lists them as a holder but its been updated today. I feel sure they weren't listed on the site before but could be wrong.
My research did show them taking up that stake back in 2017 as part of the Hummingbird asset merger.
Jaybike - I've not come across this before, so can't say. I'd guess similar to you, that this must be related to the recent raise, and that there will be another notification related to this one in due course. Alternatively, it might be something that has come out of a share audit/book keeping exercise, also related to the raise. I've certainly not come across this holder before and I did a quick search through the notifications in 2019.
Legalwolf you appear knowledgeable, I wonder if you might have an opinion as to why an RNS lands today noting a companies position in Cora from 2019 ?
I'd find it more concerning if it was a historical sell TR1 I just find the timeframe and timing rather odd. Could this be because there's about to be a further one resulting from the recent raise I wonder ?
And anyone else knowledge/ experienced in this sort of activity obviously.
4 years is a considerable time to not getting round to declaring something?
The CLNs in my view are simply a way to issue shares via a different method at a future point. It is my belief they fully intend to convert them.
If you look at the dates attached to those CLNs we will not be mining any Gold or even have the mine built, hence my conclusion above.
OverallI don't have an issue with that other than the price attached to those CLNs. The term sheet was a real SP killer to me as everyone knew a large section of shares will be issued at a 10% to VWAP at a future point.
Now, everyone knows another large dilution is on route when those CLNs get converted OR if they get pushed back all it does is hang that future 0.57ish (from memory don't quote me) future converted dilution price over the share for longer.
Mali clearly has its issue but it's by no mean an uninvestable area as seen by a Mali Lith explorer getting 100 mil plus finance deal arranged (not drawn down yet) recently.
Yep, different product, different country of origin share holders but if Mali open up Gold mining permits again then it does show hurdles can be overcome.
I don't disagree or argue with the basic premise of your post. When you compare the two term sheets, there are significant differences between them, which it is reasonable to infer could be due to the jurisdictional risks, which has resulted in this restructured financing, with the majority of it being provided as convertible loans. I think if you invest into Cora, you have to take on the jurisdictional risk. At its highest, the risk includes Cora not getting supported by the ruling regime, whether that manifests itself through not supporting the development of Sanankoro, to not awarding the mining licence, etc. Cora/BM and the large shareholders will know a lot more about the risks than ordinary retail shareholders.
At some point, you would think, BM might want to tackle this issue head on, especially if he has any re-assurances he can offer. The 'in country team' at Cora, in particular, will know a lot more about what the realities on the ground are right now for Cora operating in Mali. Is it BAU with the new mining authorities, for example? Do they have good relationships with the new regime. Are Cora even a big deal for the authorities? This kind of re-assurance will be key to instilling (retail) investor confidence, which in turn will be key to driving growth. A lot of people are put off Cora because its in Mali!
As for the large shareholders, I can't imagine they would wait for a doomsday type scenario to unfold, before recouping their investments. Rather, I would expect them to be selling (the majority of) their shares well before anything like that happens? They will likely get to hear of any looming difficulties well before the rest of us, as I believe they get more regular updates behind the scenes than we do from Cora. Retail are always the last to find out. That's just the way it goes and we have to factor it into our decision making. All imo and DYOR
is that we retail folk not entitled to the CLN part. They are the key to getting one's money back should it all go t*ts up. The amount of money raised via CLNs is many times more than that raised by shares.
So let's suppose, for the sake of argument, the worse case scenario namely that no processing license is forthcoming and buyers hold back from buying out the company scenting they can get it much cheaper when in danger of running out of money CORA hands back the exploration license and hi tails it out of Mali with what money is left in the bank.
As CLNs will rank before share holders, they will get some pence back in the pound. In this scenario, the sooner the company exits Mali on the realisation all is lost, the higher the return. Lionhead don't lose any money because you can bet your bottom dollar than any disbursements will be made only when the company has already spent some or all of the money raised via shares/CLNs on building the mine and they would be mad to do that without a mining license.
That leaves ordinary shareholders losing the lot. No wonder the BOD are committing virtually none of their money into ordinary shares.
Anybody wish to argue otherwise?
That's not intended as negative either, more just a fact.
End of the day Cora's main shareholders were happy to fund us another 15 plus mil via CLNs in the new fund raise so I'm guessing they don't feel to worried about the mining permit outcomes getting granted.
Here is Cora's reply to me I posted before on here.
"Many thanks for your email below.
Following the award of the Environmental Permit for Sanankoro in October 2022 and completion of the Definitive Feasibility Study ('DFS') in November 2022 Cora’s next step will be to submit an application for a Mining Permit over the Sanankoro area along with a French translated copy of the DFS. Currently the Sanankoro area is covered by Exploration Permits which do not allow for mining activities. As you are aware, on 28 November 2022 the Mali government announced the suspension of issuing new mining permits. Further updates on this will be provided in due course."
Cora isn't exempt. I emailed Cora about this and posted on here a while ago showing reply.
Long story short, Cora can't apply for a mining license for it's project until Mali open up the ministry of mines again. It does have a exploration license though.
AG - Cora are very much at that stage, that's why they are obtaining funding to build the mine. Yes until its built your still exploring but it is pretty standard to get your mining license before you start building work as otherwise you might invest tens of millions to then get turned down.
In our case, we are lucky Cora is still pushing ahead with the build and our backers financed more, fair play to them.
Anyone else can also email the BOD and they will get the same reply about the license.
I thought it was a Halt on all new mines? and technically that's not an area Cora are up to yet, still in its exploration lifespan. All that aside, positive movements from the company as they continue to build support and financing for when the times comes
Personally I though we were exempt from the new mining license freeze...by virtue of being in Mali for so long.......I don't know where I got that thought from though!
Regardless.....It could all turn 180 degrees and then another 270 degrees....and our BOD don't seem overly bothered!
GLA
yep Zan_TM I saw that on the GCAT sharechat....No prob! Just didn't want any "remaining weakhands" to think they were the only one left...lol
Holding firm as always! GLA
It's not complete yet. Its conditional.
They still have to pass on the 28th at the GM. Sure, that might be taken as read, but technically until conditions met and drawn down, it's not in the bag 100%
If all does go well though its a decent chunk of the funds sorted. I will be interested to see if the additional 10 mil ish gets subcribed too. If so, we should have about 1/3 of total finance required sorted.
Eager eyes to see how the remaining 2/3's will be raised.
I'm also eagerly awaiting Mali re-opening mining license applications as that's a biggie too although it would appear we plan to start the build work without and thus plenty of time ahead for them to re-open before the build is completed.
I know buddy.
I was just trying to highlight to that poster elsewhere that his assumption that, that stock was being unfairly targeted and others not didn't hold any weight to me, either via usefulness or logic. He used Cora as an example where shareholders aren't bothered about negatives, but I don't see how he came to that judgement as there isn't enough posted here to tell what shareholders think imo.
Thus I felt, he was making up narratives to fit his story.
Yes we know Tony, we click on the little red dot and can read it all.
Simple really.
Onwards an upwards
Bert Monro, Chief Executive Officer of Cora, commented, "I am very pleased with the strong support received for this fundraising from many of our existing shareholders as well as new investors. Over the coming months we look forward to providing progress updates on our flagship Sanankoro Gold Project."
Just because we're quiet Zan_TM, doesn't mean we've sold up......just waiting!
That's a good post and summarises the key questions well. I must confess to being a little surprised that Cora have even managed to secure this level of financial backing, given the jurisdictional issues. Although its right to note that they are mostly existing large shareholders rather than new money (which would have been even more re-assuring). Like you, I am more concerned by Russia/Ukraine in this context than the military coup in Mali, although they are both interconnected. We know that Russia/Wagner has been targeting Mali's resources. There are also no signs of peace in Ukraine, only escalation with more weaponry going in for the next phase, which sounds like it could be very bloody indeed. I also think a sale is as likely an outcome as Cora operating the mine.
Although I have said it would be good to hear from BM, the problem for me is:
1) It's his job to put a positive spin on things, especially when he's raising $30 million.
2) He doesn't know any more than we do how things will play out.
3) A sale could be a low ball offer if its done because of jurisdictional/mining licence issues.
I do wonder whether it would have been more sensible to bring in Chinese and other regime friendly funds into the project at this stage and as part of this $30 million raise? All imo and DYOR
Thanks all for filling me in on the licensing situation in Mali. For the record I own shares in Cora and would not be averse to helping fund the next phase of the operation. However, you guys below put your finger on what is for me the potential show stopper. Yes the reserves are eminently exploitable and the team more than qualified enough to do the job at a profit particularly if the gold price holds up. But, but, but the license. I know enough about the Russians and how they operate behind the scenes to spot danger. They don't want to be seen to overtly threaten property rights since they have interests of their own to protect, but what they do is attack on inflection points. One such is moving from exploration to exploitation and thus needing to go back to the govt for a new license. This is where they can work behind the scenes to deny western company's what would normally be legitimately theirs. I note that contained within the CLN's optionality is to reclaim the money back in the event the company is sold. I think it's clearly going through their minds that they might have to sell to the Russians or Chinese who now have the ear of the Malian government.
Perhaps I'm being too pessimistic but I see three possible options for me requiring action at some point.
1) Buy share outright. I note the main backers are putting a reasonable amount of money via this route. Clearly the price is the lower than via the CLN but there is no optionality that the latter provide.
2) subscribe for the CLNs. There is some optionality embedded here but not much. I would very much like to have included -options for reimbursement if licenses were not forthcoming
3) Buy in the secondary market at a time of my choosing. I would probably have to pay more but given the scale of upsides and downsides for me even a 50% premium on the current ~4p price would not put me off - under the right circumstances.
In conclusion I need to know more. Maybe an online interview with BM or more likely turning up in person to the AGM and doing a bit of eyeballing..
Any other takers?
It would be good if BM can do some Q&A about the situation in Mali, and whether it will have any impact on the mine development. For example, will they be wanting the licence and permitting in place before they actually start spending these newly raised funds on the mine construction. Would seem a bit risky to do it without knowing whether/what support you are going to get from this regime. All imo
@Adam, yes, sorry, the mining license (as they have exploration one already).
Mali ministry of mines closed all new submissions to and for Gold mining license at end of Nov until further notice. Why? That's unknown really. Lots of guesses mind from just getting house in order through to the fact that they are looking to set up a national gold mining corp so maybe around that through to Wagner Group maybe looking over which plots they want in exchange for there help just as they did elsewhere like in Sudan. Who knows really. However, Cora can't submit its application to mine until they re-open.
They could re-open tomorrow or in 12 months plus. Total unknown to us at this point. Cora also confirmed this affects our application to me in an email when I asked them.
@Legal, yes still a decent figure needed to hit full funded to production stage. Up in the air the route which will be taken but its not uncommon for that large part to be done via the formation of a new subsidery company.
Yes I think looking at the figures Lionhead have done slightly less than antcipated, although not massively less. I believe top of my head the more recent term sheet upgrade had PI's being able to partake in 8mil of funding, which now reads 10 mil. Plus some slight differences on this packages breakdown, although it doesn't look miles off, but I would have to work out in more detail to say for certain.