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I don't think some on here have been reading what is happening.
They are ignoring what doesn't accord with their worldview, and looking at the flimsy statement's that supports their desire to be taken out.
Please someone answer the following questions.
We know we have raised 50 million that is ring fenced and can only be spent on Cascabel. Why have we done that?
We know we are taking 36 million from the CGP deal to advance our regional drilling program.
Why have we done that ?
We know the strategic review is looking at a JV partner and looking for cost savings at Alpala.
Including looking at hydroelectric and an even faster extraction in the early years.
Why are we doing that?
This for me all points to a JV, otherwise why do these things.
Also the company has said it's looking for a JV which has been a step change since the announcement of the CGP deal.
And yet people are still talking about a bid.
I don't know why any of you read updates on Solgold, and then twist them so badly, that you pretend you know what you are talking about, when people have been shouting for nine years a takeover is imminent.
It's the same bunch.
Why can't they see it.
How will a JV work for SOLG ?
Surely we will be very much the poor relation in a JV, we can't afford to be the majority share holder, and any partner wouldn't entertain being a minority. We would have to stick to the timelines decided by the major holder.
Our priority would be their option. Not much value in a JV for existing SH IMHO.
Jezzoo do the math.
Work out our NPV on Alpala alone.
Look at the cost to bring to partial production, so we generate funds to complete a full block cave production mine, when the cost of extraction is even lower.
Look how much this can be funded through offtake, loans and a JV agreement.
We would have minimal dilution.
If you want to consider the risks of a J/V and the possible SP effects, just look at GGP, NCM and Havieron...
November 2020:
"Newcrest and Greatland sign new landmark agreements to facilitate the acceleration of early works and expanded exploration activities at Havieron"
SP rises from 21p and tops out at 37.35
SP drifts all the way down to 15.6 in October 2021
7 October 2021 PFS Results and SP spikes to 15.6
Recommences its drift down to 9.3 in July 2022
19 August 2022:
"Further to Greatland's announcement of 21 July 2022, Greatland is pleased to advise that Newcrest has elected not to exercise the option under the Havieron JV agreement to acquire an additional 5% interest in the JV from Greatland"
SP now stands at 7.5p...80% below its peak...and investors are still waiting for the crock of gold...
Be careful what you wish for...
And no...I have nothing againt GGP investors, just posting a cautionary note re Solgold...
Quady
We've taken $50m from Osisko because we couldn't get the cash anywhere else. An equity raised being pushed by BHP/NCM was presumably rejected by Mather and his cohort and that left us in stalemate, so in rode Bob Sangha and Maxit Capital and a deal was done with Maxit likely the key pawn.
With regards the money from the CGP stock, I don't think we know what is happening with that just yet. We've taken a similar amount from Jiangxi in the last week but no announcements have been made regarding regional drilling strategy so I'd express caution about suggesting a regional programme. I personally believe it more likely that CGP shareholders will be paid 20% of the merger consideration in cash once ratified and the CGP shares will be cancelled rather than sold, and I expect the Canadian regulator has insisted it be done this way. One of us will be right and one will be wrong.
The strategic review is not looking for cost savings at Alpala. That is what the PFS upgrade was doing and it has been shelved by our new interim CEO, no doubt after millions of dollars has been spent on it in the last 6-9 months.
I'm going to stop short of being rude because I think you get enough of that but there's an element of you seeing what you want to see too.
At the end of the day, Bob Sangha and Maxit are leading the strategic review. Bob Sangha is the driver behind Cornerstone. Bob and Cornerstone wants out and will likely stop at nothing until they get their exit.
That Quady does not lend itself to a JV. I'm sorry. It just doesn't.
You tell me why SolGold would dilute itself to acquire the remaining stake in Cascabel only to farm most of it back out and keep everyone locked in for another 5-10years? It makes no sense.
The correct strategy here is to spin off the regionals in a vehicle that's ready to list from the getgo and demerger FR SolGold. Sell SolGold to the highest bidder and then leave CGP, Bob, Warren Irwin, Redknight and anyone else who doesn't want to play the spin off Co to sell their distributed shares as they please.
It means me, you and anyone who wants to play the regional portfolio can do so and we all get a payoff for the years of holding SolGold. Win win win win win.
But this story of pushing Cascabel on is done. Stick a fork in it. That goose is cooked.
But it needs the right voting at this year's AGM to get over the final hurdle. Fall here and we might as well all jump into the fire and cook ourselves with it. No thanks.
It won't Jezzoo.
SolGold have shown their capital management is lax and they shouldn't be trusted with a cash lump sum after farming out Cascabel.
It's the messiest solution and gives nobody a clean break. We'd be the minority partner and we'd be so heavy manipulated by the operating partner that it would be a hellish investment to hold.
Our capital requirements would be on their timeliness for example and as a junior generating no revenue but with a good sized regional portfolio to tend to, this spells disaster.
Bozi, a far more eloquent response than mine and you're spot-on.
Thinking about it, perhaps the Osisko money is being used to allow us to keep people on at Cascabel, thus avoiding the need for redundancies and the resultant unpopularity.
I think that's exactly what it is Add.
We all know what happened in the summer just gone because of all the 'debate' it prompted and I think you're exactly right. The Osisko money is to keep the Cascabel train moving forwards, or at least give the impression, whilst the strategic review plays out to it's conclusion.
Bozi,
Let’s assume the Canadian regulator is demanding the merger be completed in the way you suggest, and the cgp shares are cancelled. Surely Solg can just reprint those shares once the merger is complete and sell to whomever they originally intended… one would have to assume, they did originally have plans to use them in some way, as they were so specifically referred to as being loaned early in the proposal of the merger.
If they do sell them, I’d prefer they went to the Chinese… bringing in a 4th major would sound great, but could lead to a standoff between them all, that could last far longer than my waning patience..
Thanks for the reply Bozi.
Your views on a JV are the same as mine.
Orthern - sorry wasn't hugely clear with my last post.
I don't think the Canadian regulator is insisting the shares be cancelled and SolGold could sell them post completion. I'm guessing it's just the whole premise of CGP selling the stock up front and loaning the proceeds to SOLG as prescribed in Darryl's presentation.
That was probably questionable given the regulator's much tighter control on companies in general.
It remains to be seen what SOLG do and I take your point. I've nothing firm to back up my suspicions and have to admit I'm speculating. But it feels right.
Speculation is all we can do right now I guess..
Well the Chinese are due to complete their DD by thursday.. so that’s our next probable RNS, unless someone makes a move to prevent them getting a seat at the table..
I admit , I don’t understand how we were able to print such a large number of shares for Jianxi, due to previous AGM resolutions without BHP NCM approvals.
"Including looking at hydroelectric and an even faster extraction in the early years."
We have been speaking about the prospect hydroelectric power at Alpala for over two years - no exaggeration. And we have heard absolutely nothing about our progress. Along with all of the other PFS optimization tactics. Nothing at all.
The company have come out and publicly stated they're no longer spending any capital on advancing studies at Cascabel as they are not driving any value.
Bozi it makes perfect sense owning 100% of ENSA.
It the ability to raise finance on more preferable terms.
Quady - raising finance for 100% of ENSA is so far off the table now I can't begin to explain.
I know you'll dispute it, and you're entitled to, but believe me when I say that no financier will go near Cascabel at the moment.
Look at the rates of interest we can all get on our bank accounts now vs 12 and 18 months ago. We're up at 1%+ vs 0.1% back then.
This unfortunately means that interest rates on debt have also climbed by the same order.
Those companies that snuck their finance in last year or in Q1 this year made an inspired decision, given that rates are set for further near term hikes.
There are some other good minerals projects out there looking for finance and they're getting nowhere. The horse has bolted, the boat has been missed. If we wanted to fund 100% of ENSA then it needed to be in binding agreements back when Ingo said he had assurances for £1bn.
This now needs to go to a company that can fund construction from it's own cash reserves. That rules many out. That cost of capital will beat anything banks, smelters and offtakers, streamers, and bond investors can offer right now.
I'm just being honest. Now is not the time to go out to the market with a large package, whether that be £3bn for 100% or £600m for 20%.
Humour me Bozi
How much money do you reckon Solgold needs to raise before we can acquire loans for the rest of the 2.4 billion dollars to construct Alpala.
You didn't really get the point u was making Quady.
Another company, with a smaller but economically not dissimilar project to cascabel has been quoted double digit % points on their bond coupon. The situation would be no different in your $2.4bn of loans case.
Just think about what that does to the Cascabel IRR on current studies.
That I'd why Mather has relented and got into bed with Cornerstone and that is why the strategy has gone from development to a strategic review, the outcome of which will not be to JV the asset unless Mitsui makes us a very very generous offer.
Solg will not go into production, that was never the plan.
The time is right for a sale now..
Let the big boys , take this on and give a fair price .
Slug? Thought you weren't coming back?
Poster who pops up, attacks other posters as 'utter morons' and gets an unrelated and irrelevant mention of immigration policy in his first post... He didn't spend long on his disguise this time *face palm*
Won't be long before he's off again :)
Hey Stackhigh..
Are you not going to highlight BOZi on his English.
No... are you the same person? .
I believe the 1bn was totally misrepresented. There's no way it was anything other than expressions of interest. At that stage we didn't even have a PFS, let alone a DFS, so there was nothing for lenders to base a decision on.
'Highlight him on his English'? Not sure what you mean by that, cash. Sorry :)
Well you like picking errors in my posts. With spelling and such ..