Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
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AgArCu, I don't think the Mail on Sunday article was saying a takeover was wide of the mark at all. I think you've jumped to conclusions there.
The key point I think you've hot on is this "But some senior industry bigwigs reckon this is wide of the mark, noting it will take years before SolGold gets its prize project off the ground. The long wait could be enough to put off any possible buyer. " END.
That line makes little sense to me as we all know there's no way SOLG are financing this to production. So the takeover rumour is based around the 'reality' that SOLG will sell out early in the stage to a deeper pocketed partner / super major who knows how to get these projects producing and has the cash to do so. In that context, the rest of the 'wide of the mark' stuff is nonsense and not relevant. The whole point is... it's a new country regional play huge opportunity for a super major and they don't get involved in those based on a short period of time. They think about it as a 20 to 30 year investment phase. Like that seen in Peru, Brazil and so on.
There's a reason why Gina R (indirectly), Franco, Chinese, BHP, NCM, Norges et al are all invested in SOLG. They know how great the opportunity is. It's not going to take years... it's going to take months or weeks before that Strategic Review reveals the game plan.
Article below... "There are some takeover rumours that are practically evergreen, with chatter resurfacing whenever the market goes a bit quiet. One of these involves mining behemoth BHP and retail investor favourite SolGold, which is working on a copper and gold mine in Ecuador. BHP first invested in SolGold in 2018 and has more than doubled its initial stake, making it one of its biggest shareholders. The City rumour mill reckons a takeover of the South American miner could emerge later this year – though this is the same mill that said it would happen in 2021 and 2022. But some senior industry bigwigs reckon this is wide of the mark, noting it will take years before SolGold gets its prize project off the ground. The long wait could be enough to put off any possible buyer. One thing is certain. As long as BHP sits on its investment, the speculation will keep churning.
Heres my take...
She had lunch with someone who said "SOLG's going to get a bid soon"...
She said "that rumour is as old as the hills" but...
She wrote that pointless article so as to be able to say "you read it here first" when the bid comes, while straddling two stools, the other having been made by Quady..."Whoa! We're going to production...Whoa in the Ecuadorian hills..." (To the tune of 'Barbados')
Surely we must listen to what our new masters are saying and not unnamed 'bigwigs'? (typical Daily Mail description)
At no stage have I heard or read any one of them state that their intention is to take this to production (I'm referring to Sangha and co, not the out of date web site) These people are in charge now and it must be safe to assume they intend to deliver on their promise.
These boys sold the merger deal to their own shareholders on the premise they'd deliver a near term deal, and we must not forget that the CGP shareholder base will form a significant voice once the merger is completed. Do they really want even more disgruntled shareholders on the Register? Doesn't seem likely to me.
Yes let's hope it's on good terms AAC
I agree Bubble2021, I think Solgold will try to sell on its assets or make itself a target for full takeover. The article was just saying 'bigwigs' don't think this will happen. And neither does the market, currently, but hopefully they will all turn out to be wrong and your reasoning detailed here will see us taken over on good terms for us PIs
Yeah but global demand far outweighs supply ,do you honestly believe that they going to sit on millions of tonnes of copper silver and gold and..just wait a couple of years for a takeover?,you would have to be deluded like copperpot and Quady if you think that's going to happen imho plus and it's a big plus as part of the licence agreements they have to prove it up and have everything in place to mine before they expire ,just check when they expire then tell me again it's going to takes years to mine ,why do you think the bod want to get a sale done?,even their pockets can't stretch that far ,so rumours abound yes ,sale yes ,another quote from NM ,To give value to all our shareholders once proven up ,he does have a history of proving up an asset and selling it on dyor gl.
JG,yep totally agree with you there crazy
JG1964, are you referring to the 'This is Money' article, or something else? Because if you read it, it said bigwigs don't expect there to be a takeover ("this is wide of the mark"). I hoped for some positive press coverage but this certainly wasn't it- highlighting that there have been rumours of a takeover for years that haven't come to anything. Shame, as a widely publicized article mirroring what lots on here are saying might draw a bit of pi interest whilst we wait for news.
SM, last week someone posted something from the company along those lines, but, as you correctly point out, this is SolGold.
Tier 1 asset and supposedly other Tier 1 assets in the making, a newspaper report on Solg potentially being a future target over the weekend and our share price starts goes South - cannot make it up
Add, your final sentence is something I've pondered too recently. It would mark a serious step change in the way this company operates were it to deliver news of the merger completing alongside an agreed deal for Cascabel or the whole lot.
The optimist in me thinks this is what is happening. The pessimist in me reminds me this is Solgold we're talking about...
SM, it seems to me that the delay is likely have been caused by us not wanting to issue the Prospectus until CGP have cleared all of their conditions - in other words, the deal is done and dusted. As it stands, and as i pointed out earlier, it appears they still have a few boxes to tick.
Equally, we may be waiting to be able to issue something positive from the SR, which as an exercise would take longer than the preparation of the Prospectus.
I have to say I don’t see much of a positive in the Newcrest/Newmont situation for SOLG shareholders. If anything I think it has the potential to delay any corporate action here, as any potential acquirer might want to wait and see what, if anything Newcrest does with its stake.
Given the boardroom troubles over the last few years, squabbling over funding, and lack of alignment with Newmont’s strategy (assuming they are successful in their bid), it wouldn’t surprise me to see the stake Newcrest own here sold off. That might be positive for us as it helps to put a new or more honest valuation on Cascabel, and would flush out anyone other than BHP and Jiangxi who are ultimately interested in owning and developing Cascabel.
If I were Jiangxi and thought I’d have a chance at picking up Newcrest’s shares on the cheap, I wouldn’t be in a rush to make a bid for ownership of Cascabel or SOLG as a whole. That said, through waiting you run the risk of someone else (Gina R or whoever) owning a slice.
I do hope as Fort notes that this acts as the starting klaxon for more dealmaking across the sector though.
A week late and counting SOLG. Anything beyond end of this week will look shoddy (again).
Anyone thought they maybe waiting on local elections that allow duristicion over what happens in there area to be counted ,results should be out today or tomorrow, government said they still have overall authority over decisions but need to keep the indigenous people on there side tbh
To answer my own question, the answer appears to be the requirement to satisfy Minority Protections under M1 61-101...whatever that is. I don't know if this has happened or why it would cause a delay.
Btw, each time I look at their Information Memorandum I find something new. In this instance, the revelation that Maxit will receive approximately Can $4.3m in fees for representing CGP. Given they don't have the cash I assume it will come from our pot. I imagine our fees will be of a similar magnitude. That's a nice little chunk out of our newly raised cash balance.
Things happen fast when events unfold. GGP a good example recently. Trading at 7.3p and near multi year lows, poor news flow and impatient investors squabbling away etc etc etc. Then within 48 hours it's trading near 9p or 30% up.
It's been pretty clear for a while now that there are some very patient people sitting on the sidelines here and wanting to get back in but see no rush. That bodes well as when the 'rush' arrives, the moves higher will be strong with 15%+ or 20%+ gains on the day. We've seen it before on past years, SOLG moves like Usain Bolt (used to) when the time is right and equally that's up and down (with speed!). SP has gone from 16p levels to test 42p levels on two (or three?) occasions over last 3 years. It's what this stock does. It languishes around in the teens or early 20's when the paint is drying. But when there's action... there's proper action.
• Funding sorted - tick
• SR underway - tick
• AGM resolutions sorted - tick
• Chinese showing interest - tick
• Market recovery from inflation woes - tick (FTSE100 hit an all time high last week!)
* M&A kicking off
• Metal Prices looking lively
• Copper shortage looming around corner
• US trillion dollar infrastructure bill passed.
• Chinese said to do the same - build their way back to growth through infrastructure spending
It's all good. Just need the merger to conclude and ARB boys to feck off. Only minor concern is that when 550m shares hit the market will some be cashing in sub 16p?? One would hope not but liquidity (better sellers market) is what many hemmed in CGP holders (weak liquidity) have been waiting a long time for.
In my opinion the Necrest bid could add real value here. Apart from the obvious speculation as to what Newmont or any counterbidder would do with the SOLG stake (keep it and bid for the rest; or sell to the higest bidder...), it is reasonable to assume that many majors will have run the rule over Solgold, especially those with a footprint in Ecuador, and may well decide it is time to get shopping for the best Junior Miners...
In the meantime, I guess the best clue we will get as to when the merger will close or especially when the first bid is coming, is when the SP starts to move up and doesn't get smacked back by the ALGOs like yesterday.
Seems like XIB still have their 12 million short position...when will they close...if not already...?
Should add, that so far we've seen BHP move for Oz Minerals which are very similar to SOLG with a decent wedge of gold but also Copper. Newmont clearly want gold and have moved for NCM. BHP were met with zero resistance or counter bids from competitors. Same could unfold for NCM.
I don't think Newmont will let Haverion go should they acquire NCM but equally I don't expect Wyloo/FMG to rollover either and think they really want the entire asset, hence why GGP seems to have popped by over 30% in just 2 days.
SOLG's time will come and it's hotting up now although the share price clearly hindered by ARB and slow execution of merger. The latter really should have been dusted by now. No idea why they are struggling to get a prospectus out... it's basic stuff. Like I said a few days ago, per haps CGP guys need more time to clean up their desks and run up a few lunch bills before turning off the CGP lights.
According to Reuters Barrick have ruled themselves out of buying NCM. This is a nice little tester as I think it shows the direction Barrick are more interested in.... and it's clearly not gold. But I suspect it's more likely to be copper!
Bodes well.
DBW
If Newmont bought out Newcrest then they would own a nice piece of Solgold, then to pick up Solgold for a fraction of Newcrests valuation would be icing on the cake, security for Newmont for the next 50+ years, copper being the new gold really, interesting times just all a bit slow
Atb
know, the Final Court Order giving approval for the merger happened on the 10th of Jan. CGP's announcement stated that subject to further approvals being obtained the transaction would conclude at the end of the month.
Does anyone know what those further approvals are?
Hopefully soon BBG been a long old road
More M&A speculation …
“One of the burning questions is whether Newmont’s bid for Newcrest, if successful, will be the exclamation mark that closes this period of major consolidation, or the launching pad for a “cascade” which sees corporate activity accelerate and trickle down to the smaller end of the market.
“2021 and 2022 were all about equity raisings and now with valuations where they are it’s consolidation and people looking for critical mass and more assets in good jurisdictions,” Liam Twigger, deputy chair of Perth corporate advisory firm Argonaut told Stockhead.
“There definitely will be further M & A activity cascading down from the majors to the mid caps to the juniors as they all follow suit.”
Will Bob deliver the goods
They could just sit it out and wait. But what happens Sid, when the chines or Gina H and co start nibbling chunks as they are already doing right now... indirectly and more recently with the chinese... very directly.
You can wait 2 years if you like but you'll likely be bidding for licence blocks (grass root) in the next cadestre as everything else in Ecuador will have gone.
NCM has GOLD. It doesn't have a huge amount for copper. Any buyer of ENSA or SOLG will be someone keen to build copper reserves which lets face it... it the metal of today and tomorrow and sought after by nearly every mining major out there.
Sid, personally I just want to be put out of my misery as a SOLG investor, I had enough.