Member Info for addicknt

Pinot, the point is they are subsidiary companies and therefore fall under the umbrella of the group. My argument is that they have to be completely separated in order to get funding.

Bozi, 'wouldn't be beneficial'? I'm a bit confused.

SM, agreed. I've always maintained that in terms of the number of concessions we have far too much on our plate and it's very easy to ask what's the point of having them if we've no way of advancing them.

SC made an oblique reference to the position in the latest interview, so I guess we can expect something to emerge at some stage.

DBW, thanks for this.

In his statement relating to the new funding, Mather referred to 18 other regional 'targets'. As far as I can make out, the funding package is hypothecated to Cascabel and general working capital. In other words we do not have any funding for further exploration.

As it stands, all of our existing assets are subject to charges in favour of FN and Osisko. In effect this means the existing plc would have problems raising any new debt for exploration. We have also been told that SC has no intention of issuing new equity.

This situation presents a conundrum: How do we add further value to the company via exploration activities if we have no capacity to raise the necessary funds? Additionally, our corporate structure is so pared-down that we currently don't have the manpower to engage in extensive exploration activities. (of course we could recruit people, but we couldn't pay them)

How does the company square this circle?

The SR mentioned the possibility of hiving-off certain assets into a newco which would be separate from the current plc. Existing shareholders would be gifted shares in the new vehicle pro-rata to their current holdings. It would be difficult/impossible to raise debt so the funding would have to come via new equity, which would obviously dilute our holding. If it were an equity only deal our current lenders wouldn't have to give up any of their security, although their existing charges would have to be amended.

This is a pretty large and complex transaction, but is this the way forward? What other funding solution exists? The current plc is leveraged to the hilt and in any event, all management activity must be directed at Cascabel, leaving us little capacity to engage in extensive exploration activities.

Personally, I'd be very happy with this solution and it would make selling Cascabel/Porv and Tandy much easier to achieve whilst also leaving us with plenty of future upside.

Thoughts?

SM, I think we chose the wrong thread to discuss anything to do with the business.

In order to fund the regionals I wonder if we'll see the previously mentioned spin-off into a separate quoted company? Existing shareholders would be given shares, but new institutions would subscribe via a placing to provide funds for exploration. In other words, proper risk capital. The existing plc has little capacity for further debt and we've been promised no dilution. So perhaps this is the plan?

Cascabel/Porv/Tandy and perhaps others would remain in the existing company.

Q, we could argue all day about the 'most likely' scenario. Let's just say we have no way of knowing what will happen.

As for your other points; 1) I agree with you about a low bid, which is EXACTLY why we've raised the finance - it provides the defence against such a likelihood. Up until now we've been incredibly vulnerable - this is no longer the case.

2) Again, I agree. I've always said this would be an agreed deal and my opinion hasn't changed.

3) An agreed bid may provoke someone else to make a hostile bid, but given we've been talking to so many parties for a long time, I don't think it likely. Irwin explained his thinking on this in yesterday's interview.

His observation about Rinehart was very cryptic. Otherwise, I thought he was all over the place. Thanks for posting, even if I do find the interviewers intensely aggravating.

Eloro, yes. Change of control provisions are very important and bear in mind the EA allows us to operate independently from the government - this was a huge concession.

Q, there's going to be a very long wait for your prediction to come true and a great deal will happen in the meantime.

Wensley, oddly enough the trade was reported at the correct time on the LSE web site. No idea why it didn't show up here.

That's interesting; he refers to us having 18 other targets in Ecuador. What happened to the rest?

42m shares traded and closed up 211%. They still have to repay their 10m loan in November ,which is secured against Solg shares.

Obviously yesterday's news is enormously helpful to DGR, but it doesn't answer the cash question. Will he be forced to sell some? If so, I'm sure a buyer could be found.

I can assure you he isn't NAL or any of the other derampers and he most certainly isn't an idiot...far from it.

Fair point, but I think a degree of relief and optimism is justified after the years of disappointment. This is an impressive deal.

You won't see me raving about 10 quid next week, but I'm extremely pleased with the news.

I thought you sounded a bit downbeat this morning, Jerry. Has this podcast cheered you up a bit?

DBW, hopefully nothing.

Been an exceptional day for the company and paves the way to the delivery of shareholder value.

I suspect many of us may have had the odd nervous moment over the past few weeks, I certainly have, but we are now in a position to put those fears to bed.

So, what's next? My money's on the revised IPA.

Great stuff, Scott, you deserve every penny of your $200k annual salary.

Schlemiel, thanks for this.