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No stress Quali, nothing going on here, move along please ;))
Confidence in abundance there, Qualibashi. I agree that Chinese owned company will probably be the first to bid. No rush for them though, fingers in many pies etc. Long wait still to come, but worth it eventually, if the dilution isn't too painful until then (most of the dilution will probably be through share issues to greedy directors with noses firmly in the trough!! These guys this quarter, some different ones next year etc, cheeky sods).
Good to see a bit of balance in this board- few months ago the rampers were running riot, working together to try and shut down any sense of realism that got in their way. Now we've got a fair few understandably disgruntled investors rightly airing their frustrations, and the rampers still clutching at straws.
I wish the company was in better shape, but whilst the sp is rock bottom and Maxit are trying to bluff us to a bid, at least we've got debate here.
Add - the future is certainly not bleak- the Tier 1 is so massive potential buyers are thinking not how much will it cost to own-but it will be even more expensive not to own a 55 year mine life at low capex extraction costs and guaranteed production.
FOMO is a massive mindset amongst the Major's.
We all know this and so do they.
I firmly believe that the CHINESE will be the first to bid.
Deep pockets and world domination makes this a certainty.
So guys, sit back take the temporary pain now and watch for any rebound as a sign of future activity.
Q
I'm starting to get the impression this will always be promising jam tomorrow and always sucking more fundraising from punters. I'm glad I sold most on share price bounces and will look to do the same for the rest if that happens.
Fair enough Addicknt, we will have to go down the incompetence route then sadly.
DM, I share your frustration, but we need to reflect upon the complexity and magnitude of what's going on and recognise these things take time.
Monte, Caldwell is on $200k per annum and Clare earns next to nothing.
I honestly don't think either saw it tanking this badly.
I think they thought a bullish statement from Maxit and the threat of an SR (that could see the asset move into the hands of another party) would draw out a bid. It's a tactic that has worked before, but it relies on FOMO from bidders with deep pockets. Lots of majors would like to have Cascabel producing and adding to their output, but it's a proposition laced with uncertainties and they have shareholders too. "Why did you spend 2bn you could have distributed to us as div?" is a hard one to answer when the next batch of CapEx money is due.
Possibly because they get circa 5 times in salery and rhats part of the deal?
I believe its called a bung. I'm not saying that exactly what they earn or what has happened, its just quite common practice in the real world. And guess what you will be the last to know. Most will never know,yet it happens all the time
DM, no, it wasn't directed at you and I happen to think they'll be looking for more than double their money.
They didn't invest 'blind' and know full well what the direction of travel is likely to be.
if any of our new pessimists have asked themselves why Caldwell and Clare ponied-up £200k each for new shares if the future looks so bleak?
Quick question as I'm too lazy to dig around for this - what are they paying for CGP's 15% i.e. how is the deal structured?
Perhaps they plan to jv/partner on some those 60 licence blocks so can't include them at present until merger sorted and jv deals then done??
Markets don't value assets, they value companies. Solg approach since Maxit brought on board has been too one-dimensional. As a company, we now look as desperate as some of the posters here. Today's RNS shows half-hearted attempt to appear busy, but smacks of boardroom despiration for a bid. Shame the interested parties have deep pockets and there is lower hanging fruit to fight over before working out how the f to block cave an enormous, deep resource in a relatively unproven LATAM country. Market not expecting a takeover soon, so sp low. You'll see buy ins and a SP rise before a bid, IMHO. If history tells us anything, it's that this post will now be jumped on by 'professionally hopeful' people here, holding up Noront's steep sp rise as a reason to be cheerful, or claiming the Chinese investment is a guaranteed pre-cursor to a bid... They will still be saying this in months to come, or they will go suspiciously quiet.
Best bet is probably to look at your average. If you have funds to average down, and can risk this going lower for a while yet, help yourself. If you're in but can't come lower, sit tight, stop reading Fort and Red's tripe and enjoy some other investments. And if you're not in yet, only come in if you're patient. If you are, there is money to be made eventually. Just don't let the hype men tell you it's coming soon...
DM, the problem at present is that the market isn't valuing ENSA at anywhere near the levels it should be. Thus we have a situation whereby we have taken an almost 25% hit in dilution terms but without the nice benefit of 15% ENSA being factored into share price.
On the whole I am surprised by some investors on here you like to grumble regularly. Many were annoyed that SOLG had stopped Exploration. Today's news confirms the plans to explore in Ecuador and get Australian assets set up / prep'd for might be a JV deal in future.
$11m should see quite a few decent holes in Rio and a few others. That's some decent upside opportunities to come while we no doubt continue with partner or sale talks in background with interested parties post SR. Latter is my assumption.
Red, through the fog of recent negativity (and the fall of the sp in particular) your post of 9:20 is informative and uplifting! Thanks.
I expect we might hear more on Bramados once the merger has concluded as very much a CGP story but that asset is doing ok and think CGP are carried for bulk of exploration costs. I get a feeling that they might be looking to streamline the business ahead of full sale hence why exploring outside of Ecuador makes sense as any buyer going for ENSA and entire folio might want a 100% Ecuador business with no loose ends. That said, you never know... they might sell their stake in Bramados and tidy that side of things up although doubt it. Not sure on Chile. Do NCM have any further iv's or options on CGP's assets or was the last relinquishment the last? Newmont might be interested in assets down under like Solomon Islands blocks.
BTW the 13 days of operating expense was of course CGP, based on their last Annual Report...
Based on their last filed quarterly report it was 12 days
Red
I don't believe anything now.
I only understand one thing.
Someone putting hard cash on the table for an offer. Everything else is the same old talk and estimate of value, we have had on a daily bases for 10 years now.
Good post, RK.
Yesterday I had a poke around Google in order to better understand the methods employed when valuing mining assets. (it's not an area I've had any experience of) Far from being straightforward, it threw-up a lot of interesting stuff and I'd recommend anyone who's interested to have a look. One thing's for sure, the various metrics used can lead to wildly different outcomes.
Wait for it red a green poster gonna appear lol!!
Red ,post recommended facts speak for themselves
Aren't we missing the positive significance of this...?
Its only 13 days worth of total Operating Expense and clearly when the first tranche was lent on 27 anuary it was expected that the merger would complete soon.
second, its a mere £150k, but...
Most significant they haven't raised the money by selling SOLG shares.
Which confirms the view that these will go into Treasury.
So..valuing everything at the time of the merger announcement, we get
£25.331 million SOLG shares and
£639 million of Cascabel (15% of NPV of $5.2 billion
Total £664 million divided by 556.815m = £1.19p/share, for which we are paying the equivalent of 16.12p/share.
Or, to put it the other way round, we are paying 556.815m x 16.12p = £89.8m less £25.3m = £64.5m for 15% of Cascabel.
Giving a gross value of £430 million for Cascabel alone at the merger terms.
This is £73 million MORE than SOLG's current MCap!
Whicver way you look at it, either
The CGP merger is the deal of the century or...
SOLG is massively undervalued...
All contributions welcome...
25331
I think the management's inability to stick to any time lines is the main drag on the SP.
They simply cannot do anything on time or even close to their own estimations.
This has hurt the SP time and again over the years. They are indefensible imo.
So MD&A was uneventful, we await the strategic review.