Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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. 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.
Sorry wrong board on this one !
Ganfeng/BCN -- mistrust = 50/50% !
I got a mail back from BCN telling me (the bleedin obvious) its only a possible offer, my response is yeah - get this, but we are concerned that the BOD think if it were firm it would be acceptable !
I can think of a very good use for the money if Ganfeng do want our 30% !!
Agreed @Dallasdaz the signs were there from very early that BCN weren't going to play ball. Makes you wonder how the JV came about in the first place, like him or loath him, DL could be a very persuasive man.
Crucial move that sliver as it turns out ;)
Yes @Barksy, that was DL rolling the dice trying to get JV1 into BCN's production plans...BCN's acknowledgement and rebuttal basically of our scoping study is here...https://www.investegate.co.uk/bacanora-minerals-ld--bcn-/rns/rare-earth-minerals-plc----scoping-study/201412220700124075A/
It did however get a sliver of the JV into the mine plan.
It's all guess work @TC. We may have already accepted a conditional offer from Ganfeng under NDA, to be announced only if BCN agree to their offer.
they don’t seem overly concerned now... maybe we can trust ganfeng more than we could bcn... when do you think we should know/find out what ganfeng do have planned for us...
Why cant they divide it up 70/30? I ain't seen anything that say's we are bound to develop the JV 'together'....hence the emphasis KM put on trying to get a Mining JV agreement.
I'm pretty sure Ganfeng will have ways and means plus a few tricks up their sleeve 'if' they don't want us as a minority partner.
dee... the chances are... we won’t need a dfs...
& that's 9 years invested here as time already served... I had thought Amapa could see me out within 10 but GFL just cracked open a possible extension....
and ganfeng would own 70% of the same piece of land... the jv has incumbent rights to proceed to the mining stage... that aren’t one sided...
I'd be just as happy with GFL buying us out as I would anything else .... One thing I don't want is another 5/6 years of speculation & pondering what plans BCN might or might not have for the JV's & our involvement in it , we've suffered enough dilly dallying by Secker & co ..... GFL offered an alternative from day one IMO & I'm now eager to see how that plays out ... whether for better or worse I don't care because something in the next year or two is far more preferable to me than waiting for BCN to get their fingers out & wondering what shape that will take ... I had planned a possible exit after we took 27% of Amapa but if GFL grab BCN I might wait for a year or two & see how Sonora plays out instead ...
All good for me & an outcome now either way within the window I planned to remain invested 9 years here is more than enough .....
We spent a lot of money independently having those scoping studies done .... we know what we’ve got ....
As Bannor says, Economics trumps sentiment:
Mexilit is to initially have three directors, all of whom shall be nominees of the
Company. On completion of the REM Agreement 1 Stage 3 Option, REM Mexico will
be entitled to nominate an additional director to the board of Mexilit;
• the board of Mexilit is responsible for the day to day management of Mexilit and the
REM JV1 Concessions including management of the exploration and development of
the REM JV1 Concessions;
• shareholder approval (from the holders of 2/3 of the issued shares) is required in certain
circumstances including on the issue or grant of rights in shares, borrowing, granting
security, sale or disposal of any of the REM JV1 Concessions;
• if Mexilit issues a cash call notice to its shareholders, each shareholder shall be obliged
to contribute its proportionate amount, failing which its interest may be diluted;
• shares cannot be transferred or charged except with the approval of the board;
• each party has a right of first refusal in respect of the others’ Mexilit shares; and
• drag-along and tag-along rights apply between the parties in respect of any proposed
sale of interests to a third party
Those are some bullet points regarding Mexilit.
I'd pay attention to the cash-call, and the the 2/3rds requirement.
What's stopping Ganfeng from making it near enough impossible for Cadence to raise finance? Business trumps sentiment, yet Ganfeng are proving their ruthlessness.
It's entirely up to you if you disagree, but the response I'm receiving via email shows there are many that disagree.
That is correct @Ivybush, the current JV agreements are for exploration only, and as a minority partner we effectively have no say in that.
We have been trying to get a Mining JV agreement off BCN for years, will Ganfeng give us one?
Without a mining JV agreement we could end up owning a 30% parcel of land with no means to mine and process it.
Be interesting to see how Ganfeng go about this.
there could be other reasons why ganfeng might need a 20% jv partner... rather than owning 100% sonora outright...
@tomcat_14 Agreed, depends what is in jv agreement, but I understood [as stated by KM at an AGM]
that this was very loosely worded.
Even if we can develop as per scoping study, with a market cap circa £45m I would see
funding difficulties for our minority stake to get development costs.
depends how robust the jv’s are... but if ganfeng want to brush the dust off our 70ktpa scoping study... and asked us to contribute to the development of that... why wouldn’t we ffs... that’s what we wanted from the start...
Particularly when you are about to buy into a big mine
"Economics trumps sentiment in business" @Bannor, so very true.
That is why I would not expect any favours from either BCN or Gangfeng for our jv.
I understand there is no mining agreements for either jv [inc Pilabara] so we are not in a
strong position to negotiate future development----Dallasdaz confrm?
Therefore I would expect Gangfeng to play "hardball" and either develop elsewhere [not
likely imv] or propose that we contribute to development costs or at best an "earn in"
agreement--with costs out of our control. Thus I feel we are strapped in to probable
difficult period of negotiation.
Roll on Amapa creditor agreement --at least we have input here.
a bird in the hand is worth 2 in the bush.
@Bannor
Looking at Ganfeng's treatment of BCN, what makes you think our 30% JV will achieve even 3/4 of the $200M? Although I am a shareholder of both BCN and KDNC, I think KDNC-only shareholders should be concerned of the current situation too, because if the current deal goes through as-is, it will set a precedent and therefore KDNC's share of Sonora might not achieve the desired outcome/value. And that is if an offer from Ganfeng even comes through.
I think a superior BCN offer will benefit both KDNC and BCN shareholders - currently, its a lose-lose situation.
I agree TC ... it is very much down to our BoD .... KM indicated a value of circa $200M for our 30% JV's in Sonora ... that now could materialise sooner rather than later & provide us with opportunities for Amapa & Oz assets we don't currently have without further debt &/or dilution &/or further asset sales.
Even if we get 3/4 of that value in the next year or two I'd be OK with it & consider that a better outcome than the thought of waiting another 6/7 years when the economics, politics & technology all have chances of change in the interim... nope for me it's a thumbs up for the Ganfeng buy out of BCN .... if the shareholders there can squeeze some more pennies out of GFL all well & good for them ... But I won't lose any sleep over it if they can't &:look forward to what GFL come up with in regard to the JV's... at least something will happen quicker with GFL than it was ever likely to with BCN running it & personally for me it can't come soon enough even if it doesn't live up to all our expectations it's been far too long coming in regard to Sonora for me & I'd be happy to see a deal done & across the line whether by sale or joint exploitation.
If that doesn't chime with BCN shareholders - so be it as I said I won't lose any sleep ... Economics trumps sentiment in business.
caught between the devil and the deep blue sea... we have a vested interest in sonora... and by all accounts... the ganfeng deal will see the value in that increase dramatically... whether we can realise better value than bcn have... is really down to our bod and how we fit into the future plans for sonora...