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You're right addickt...wrong denominator...£1.35...
Sound comments as usual addickt..
Heres my take...
Jiangxi has been brought in as a stalking horse...when you consider Irwins comments, other players would be hellbent on preventing this tightening the Chinese armlock on copper markets that they already have...
Of course BHP are potential players and even if they dont succeed, they will make any successful bidder pay too dollar....and NCM want the maximum return on their 'Strategic Investment'...
It seems to me that they both voted against the resolutions because they can see the game being played here...to their disadvantage...
Of course Jiangxi are serious about their investment...$30m is peanuts for the Chinese Government, financially and for strategic reasons, including entrenching themselves further in Ecuador..
So I see every probability that a third possible bidder would be sought...when you see what happened with a two way tussle for Noront, a three way fight here could produce a highly satisfactory exit price for us all...
Of course the value a bidder places on a target is a key consideration.
BHP clearly had a limit for OzMinerals and look to have secured a reasonable deal...but this is different...
My judgement is that Wyloo ended up paying more than they intended fir Noront, but in my M&A experience, Boards often end up paying more than intended...its a bit like going to an auction with a maximum price in mind and walking out having paid more because you wouldn't let go...
So Jiangxi are key for me...they undoubtedly have their eyes on the prize and deep pockets, but when a third player enters, the sky is the limit...and Jiangxi would still walk away with a handsome profit...
RK, £2 would value the company at approx £6bn and as much as I'd love to see that it ain't gonna happen.
Mather has always focused on an Asset Value target, not Market Value...
Surely that gives you anything up to £2 ...?
Cheers NRL...I took it that Irwin meant 78p was much too low...
Hi all
After some lobbying, Ecuador is planning some changes including security for mining projects--
https://www.mining.com/ecuador-to-launch-security-program-for-mining-projects/?utm_source=Daily_Digest&utm_medium=email&utm_campaign=MNG-DIGESTS&utm_content=ecuador-to-launch-security-program-for-mining-projects
Apols if this has been posted already. This may help get majors to move on SOLG. The pic is of Cascabal btw.
(Long SOLG since 7/20)
To answer my own question:
Assuming it's an all share deal there will be just over 3bn shares in issue. The current combined market cap of both companies based upon todays price is £474m. In other words, it seems to me that my hypothesis is correct; the current price already reflects the post-merger company.
I'm pretty much stating the obvious, but I wanted to see if we are currently trading at a discount or premium to the post-deal structure. It seems we're pretty much spot on, so I guess we can conclude the market is neither positive nor negative about the deal.
anyone had a stab at working out how many shares will be in issue once the merger is completed? Obviously the possible cash element will have a bearing.
Our current share price seems to be reflecting the combined market cap on a fully diluted basis.
Btw, I noticed some comments about the issue price of the latest fund raise and how this may set a benchmark for any deal. Personally, I wouldn't get too hung-up about this - in a competitive situation it will become irrelevant, and naturally Citi and Maxit's task is to create some competitive tension.
Let’s move on :)
I think we must be. It was the comment about the number of shares being irrelevant which threw me.
Of course. I’m not sure then why you seem to be disagreeing with my earlier post . I was just pointing out to Orthern that any buyer will only be concerned with the price they are prepared to pay .....in which case the current sp or number of shares in issue become largely irrelevant . Maybe we’re at cross purposes...
BPHIL, I'm not sure I understand the point you're trying to make.
It goes without saying a buyer is only concerned about the value they attribute to the company and that value is divided by the fully diluted number of shares to achieve the price we receive. But this is pretty obvious stuff, isn't it?
It will dictate what WE receive, depending on how many shares we own . The buyer won’t care too much ...the bottom line is their concern , what price they are willing to go to should we get a bidding war
I hope your right BPHIL… but we have to consider jurisdictional issues and IRR value when considering what a mining company may be willing to pay
BHIL, sorry your observation isn't correct. The number of shares in issue will dictate what we receive, so it's highly relevant.
BPHIL ….. nor do I
Monte …. Nick always had is own interests, and ours by default, at heart and the problem has been letting in the likes of BHP ….. you’ll see a whole new company emerging from the ashes in the very near future….. shortly after you’ll see it sold .
RK …. Totally agree there’s no need to give the Chinese any more cheap shares. They’ve got their foot in the door and the rest is up to them.
Then you think , Orthern, that the final price paid for the whole will be less than £1.2 billion ?
I don’t believe that. The big players will have a price they are willing to go up to....and the sp or number of shares in existence is irrelevant . I don’t think this will go for just over a billion....unless there’s the mother of all stitch ups
How funny (not) if the SR came up with the idea to sell cascabel,but keep solg going to continue exploring and prove up the other targets. After all these years, when it was the original idea to prove up, sell ,and move on .
That would actually be a joke and just show how Mather and his cronies have actually destroyed any real value here, with their ideas of grandure.
They would certainly have some questions to answer at that stage imo
Anything over 40p from here is a great result… I think people need to forget referencing previous share price high points, we have a load of extra shares in existence now.. and are sat at 15p….
Anything circa 40p will be a result.. we are where we are now.
NRL2901, thanks for your sensible post. I had actually missed that comment from Warren Irwin. Here's the link to the tweet and thread for those interested: https://twitter.com/bigdude6669/status/1595832739877769216?s=20&t=2oOFIzAEVeRcqvSQ_0Ih4Q
He also goes on to discredit the 78p+ fair value as outlined by Darryl in the merger presentation as "prognostications that were made by people who are no longer with the company".
I know it's not the most popular option on here, but I really think that Bozi's suggestion of hiving off Cascabel into a standalone company and then selling it on, leaving SOLG to continue exploring the regional portfolio would be the best long term outcome for shareholders. It'll allow us to get a better valuation from the market of Porvenir & the other prospects. Given Irwin's posts, 45p-50p for Cascabel seems about right?
Lol bed and breakfast T20……
People T20 because they are gambling………
.
Red, let us see what the next few weeks bring and if any offer arrives. For balance Irwin was clear on 24 November that “ You are in the wrong place if a 600 percent return here is your expectation”. So lets firstly receive a bid then evaluate from there. Remember being in the AA. People thought the first bid of 35p was a lowball mickey take and it won. Partly due to board incompetence (but order board not covered itself in glory for several months). But also lots of dark arts go on, as a man of your background would understand. Hopefully any lowball offer would trigger a Noront style bidding war. But not guaranteed and key players clearly want some form of monetisation.
I don't think the CGP shares will be sold...I think they'll be held in Treasury...
If the Bpard want a price north of 100p and they keep selling shares sub 20p thats going to be a hard task...
But if they're held in Treasury they can be used as a weapon against BHP if needed...
Meanwhile a meaningless day...prices tend to drift on low volume...only 2.8 million and 400k of that was my T20 bed and breakfasts...
Lets see what tomorrow brings but it could be a quiet week and next Monday is also a Bank Holiday...leaving 4 trading days after that before the CGP vote and merger...
Another key question is how much of a premium can Solg achieve for the CGP shares…. And who will take them? Jianxi must be favourite, but after paying 16p recently in a mutually agreed deal, how much more would they realistically be willing to pay? I can’t decide if a new, 4th major entering the fray, would just cloud the water even more, creating more of a stand off between each other… or finally trigger a bid…. and how much of a premium to Jianxi any new major would be willing to pay.. that low recent 16p share print may be used as a reference point.