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1 million bought this am, so far, any news would be more than welcome to all still invested.
Hi Lenoman, I have been invested here since 2016 and thought that the sale would be over the line well before Feb 2022. After being invested for so long, I am happy to keep holding and I admire your recent buy but I think this is now a coin toss despite the ACF valuation back in the day and the BOD, NOMAD and RNS hype around this share. Sadly, even the external professionals, banks etc have been unable to get pen to paper despite the massive resources/reserves and global demand for PGM. Great to see some old names still posting.
GLA
I've been here for getting on four years now and don't think it's a coin toss. That would imply it's a 50/50 likelihood of success/failure. I still see, personally, that success is considerably more likely than failure: at least 80/20, depending on your definition of success. Obviously nobody expects Hoochy's £3.50 but I still anticipate a decent return from this point, even with any haircut, and have almost trebled my holding over the past 18 months.
To my mind, short of expropriation - and the Russian state has shown no inclination to actually expropriate friendly companies - the outcomes range between a sale of assets of varying magnitudes, depending on offer prices and potential haircuts, and no sale, with the company then having little choice but to activate Sinosteel and starting to build the mine, which would only add value over the longer-term.
However, it is hard to believe that the company would have mothballed development for this long if they were not confident of getting a sale over the line. Which in turn begs the question of what might be holding things up. I can see two explanations: one is the due diligence requirements of any buyer, which in turn highlights both the successful DFS on Monchetundra last year and the recent court cases (i.e. the Kosvinsky Kamen tax one and the Queeld share certificates one); another is negotiations with the state on acceptable sale prices and haircuts.
It's fairly obvious now that the court cases are almost resolved (and, moreover, resolved in the company's favour) so surely it stands to reason that this should remove a final obstacle to a binding offer materialising. Indeed, some people have received communications from the company's PR people that they will now only update shareholders in the event of a material change. What other material change could there be, in such a period of enforced silence, than a binding offer? If the Russian state is then the second obstacle, my view is also that a big part of Artem's role has been to quietly prepare the ground in advance to smooth the transaction once that offer does indeed arrive.
Ibizamatrix, thanks for the pleasant and honest response. I too have been here a long time, and agree it’s all 50/50 now. I continue to believe the Bod, are still trying to get some kind of deal over the line, but what do I know, I’m thick as two short planks, according to the resident experts on here, telling us all it’s a scam, etc, etc, time will tell, it’s all we have left. GLTAGH.
Mont, great post 🤝
Mont, always enjoy your well thought out and balanced post, cheers.
Good post Montmuzard, I guess the £3.50 you mention was predicted by a very positive poster prior to the Russian invasion of Ukraine. It’s seems very, very high to me.
The rest of your post resonates with me, it’s frustrating that we haven’t been advised of the increased value ascertained with the new DFS and the lack of comms from the bod.
You were obviously a shareholder whilst the shares were trading around 40p, do you think they’ll reach those levels again or do you see them ultimately trading / selling for less ?
Thanks fellas. One other explanation, I suppose, for the ongoing mothballing - which could cast doubt on my optimistic reasoning - is that they cannot develop the mine due to sanctions. But three things would, in turn, cast doubt on this as an explanation: (i) the fact that the company have told us repeatedly that they are not affected by sanctions; (ii) the fact that, as we know, their metal basket is largely excluded from sanctions; and (iii) the fact that they have clearly sold the stockpiled concentrate, while doing an awful lot of work at WK, which implies that they can mine successfully.
So, I think it's clear that doing business in Russia is difficult in general because of sanctions, and they would rather stay as far clear of sanctions as possible so as not to get caught up in then, but I don't see that sanctions would be the explanation for not triggering Sino in the even that there was no deal on the table. Ergo, there is a deal on the table awaiting some kind of trigger to move to binding.
A final thought: with everything going on the Middle East, the polls are looking dire for Biden at the moment. This could change, especially if Trump goes to jail. But if I were a bidder with an in-principle offer awaiting a rubber stamp - particularly if that offer enjoys some kind of haircut and war discount - I would be getting quite nervous about the US election coming ever closer.
"You were obviously a shareholder whilst the shares were trading around 40p, do you think they’ll reach those levels again or do you see them ultimately trading / selling for less ?"
I have no idea, and I've held all the way down from that level. Hindsight is a wonderful thing. I've got various outcomes sketched in my notebooks, and at present my lowest anticipated price is around 20p for everything and the highest goes up to 56p. My hoped-for price is somewhere around 44p but I'd be more than happy with low-20s. I know plenty of people are expecting less (10p-15p) but I personally just do not see that given the value of the assets in-ground and the time it has taken.
Nice to see some balanced musings 👍
Good discussion. I'm not convinced that Trump would be able to end the Russia/Ukraine war within 24 hours of negotiations if/when he regains the role of POTUS but that's just my view.
Montmuzard,
Clearly sold the stockpiled concentrate? Can you provide a basis for that comment or did I miss an announcement?
I still think the main issue with a company or asset sale is the availability of potential end users for product, companies that have imposed sanctions on Russian products, reduces the market place for the product which in turn reduces the price.
Builder the recent comment from Trump that he is willing to provide military support to Ukraine but only as loans suggests that he is unlikely to really have a plan to end the war, and foresees a future with a Ukraine able to repay the loans, so I don’t think Trump will offer a solution.
My view too Offler.
Montmuzard, the negheads will be calling you a notorious ramper, no doubt! Very good thoughtful posts of which we get fewer as time goes on. I would be very surprised if they announced that they are going to mine. I think that would have happened well before now.
The most likely thing is we are waiting for final signatures on a deal. Maybe the Court decision in June is relevant, maybe not - we don’t know. Your expectations are on the low side - you are factoring in an enormous haircut as well as a sales tax! I think a sales tax of 15% might well satisfy the authorities - but maybe only if something like fair value is achieved. Maybe there is pressure from the authorities to achieve that. Our BoD could well be in a pressure cooker and not all the heat is coming from disgruntled shareholders!
Not calling anyone a ramper, I would just like to know where the concentrate sold comment comes from.
I obviously can’t speak for Montmuzard but I’d think it was related the accounts for the sub Kovinsky Kamen that had its AGM last week, and which sone expected to generate some news for EUA or some form of financial transaction or transfer
Well thought out posts, Mont, and as always pleasure to read.
I am of the opinion that we will get around 50% of the HCW February 2022 valuation which is around 20-25p less any fees/exit tax (I have excluded Poaz and applied a token amount to the entitlement to Nyud).
If the DFS shows increased reserves for MT/NKT I see upside from this. Not sure what value the recently acquired Trav licence will add but it will be something as it is a continuation of NKT.
I am also of the opinion that the length of time this is all taking is down to have EUA2 (hydrogen?) up and running in tandem once or Russian assets are sold.
I have trebled my holding too since the SMO started and brought my average down into single digits.
Remain confident of a payday. A good evening to all genuine LTH's.
I remember when we were suspended sp 7p all the swamp posters said we would be delisted started trading again 9th July 2020 finished the day on 12p by Monday 13th july sp 20p. Nothings changed what the company own just the same swamp poster's are still here.
"Clearly sold the stockpiled concentrate? Can you provide a basis for that comment or did I miss an announcement?"
It's fairly clear if you read the KK accounts.
"I still think the main issue with a company or asset sale is the availability of potential end users for product, companies that have imposed sanctions on Russian products, reduces the market place for the product which in turn reduces the price"
Last I saw, nobody had sanctioned PGMs, platinum prices are on the way up and palladium has bottomed out, about to start its rise up towards $1500 again by the end of the year.
"Your expectations are on the low side - you are factoring in an enormous haircut as well as a sales tax! I think a sales tax of 15% might well satisfy the authorities - but maybe only if something like fair value is achieved."
Maybe, let's hope so. To be clear, my 20p prediction is based on (back of a cigarette pack calculation) us achieving a reasonable NPV (which must be at least $3bn) with a full 50% haircut + 10% of remaining fee to the state x 80% for USD x 80% again for costs/taxes x 80% again for ownership share x 80% again to retain some money going forward, leaving 24p.
So, if you revise any of those figures upwards -- e.g. a strong DFS and rising PGM prices could see, what, $4bn or $5bn NPV (one NKT pit alone is worth $1.7bn), Artem might negotiate a smaller haircut, the USD might strengthen again against Sterling, the share apportioned to costs might be lower, the company might pay out proportionally more as a dividend, who knows -- then that leaves plenty of upside IMO.
If anyone wants to reminisce, the ACF Equity note from December 2021 suggested a fair value of £1.15-1.27 (!)
https://acfequityresearch.com/wp-content/uploads/2021/12/Eurasia-Mining-Plc-Flash-Note-ACF-Equity-Research-FINAL-20122021.pdf
@Monkey - I've wondered this too: "I am also of the opinion that the length of time this is all taking is down to have EUA2 (hydrogen?) up and running in tandem once or Russian assets are sold"
One of the typically cryptic comments a few RNSs ago - the one about wanting potential buyers to keep quiet until Eurasia was in a position to execute, not the other way round - implied this. Fancy that: imagine if we've waited all this time while a buyer has been desperate to sign but it's Dmitry who has kept them hanging!
Note that the ACF report Dec 2021 used a price of approx $12000 per tonne for Nickel ie 40% below the then ruling price of nearly $20000. The current Nickel price is close to that! Nickel accounts for half the value of NKT.
Dave, since then there's been the russian invasion and we've lost the Rosgeo JV. In many ways its a totally different landscape
Monkey, where would I find the HCW Feb 2022 valuation, I don’t think I’ve seen that anywhere?