Member Info for addicknt

Thanks, Fort. I mentioned the arbitrage opportunity a few weeks ago and wondered why we hadn't, at that stage, seen any real evidence that funds were taking a position, so perhaps it's now happening. It seemed a pretty good opportunity to me and was puzzled that a few hedge funds hadn't jumped on board.

Incidentally, I noticed that the trade information on the Stock Exchange site showed that yesterday a majority of the trades were algo transactions and not just AT. This is unusual. Anyone have any thoughts? Presumably they will not represent private investors?
Btw, the mysterious 4m trade didn't appear on the list.

Good post 2Luke, but I fear 50:50 is pie-in-the-sky stuff. And no one has yet demonstrated why, or how, a jv delivers value to shareholders. It seems to me the concept of a jv goes against everything we've heard over recent times from our new masters.
Of course anything is possible, but I believe we can rely on the new team only to pursue a route which delivers what they've argued for and promised to their own shareholders.

Fort, if you want to see the full details of the various discussions which took place and who was involved, have a read of the CGP circular. It's all there.

anon, I doubt if BHP knew about it. Once upon a time they may have been consulted, but not nowadays. I'd be surprised if there was much, if any, dialogue between the two parties.

rcgl, agreed.

rcgl, I'm pretty sure an acquirer would not want the royalty deals and, following negotiation, will be re-paid, which of course will be reflected in the price a buyer will pay for us.

Q, a few days ago I asked you to explain why you thought a jv was the way to go, but didn't get a reply. I wasn't interested in how it may happen, but specifically what the financial implications would look like i.e the value of the project and our share of it. And also how this would provide shareholders with the realisation of value which has been promised by our new management.
I note you are still referring to 'non-dilutive fund raising' - I assume you mean more royalty deals. Can you explain why a jv partner, who will most definitely be a global major, would accept royalty funding which gives away their revenue? Or are you suggesting we'd be happy to give a royalty on our minority stake, thus reducing even further the value to our shareholders? Of course, this implies a royalty funder would be happy to back a minority holder which, given the fact we'd have no control, strikes me as unlikely.

I get the impression that not many on here have read through the CGP Circular, which, although it contains all the endlessly dull regulatory stuff, has some good info.
But the most important thing is the message and tone.
In effect, what it's saying is this: ' Despite Solg's previous hostile approach, we now agree that we are better together. We've had a consistent view of what should happen here and have managed to, in effect, construct a reverse takeover and we are now in the driving seat. Our opinion has always been that an exit is the way to create shareholder value and now we're in control, we intend to deliver it. Shareholders, this is an excellent deal for us and we urge you to accept it'.
Of course, I'm paraphrasing, but this is the message loud and clear.

RK, Caldwell is only taking a pro-rated $200k p.a. Miles away from NM and Dc's ludicrous remuneration.

DBW, Q could and probably will argue, that their involvement is a precursor to a jv. However, I can see no reason why they'd want to share the asset with us (we'd bring little to the party) and, more importantly, our new masters would not be interested, despite the smokescreen contained within the SR.

Q, I sort of agree with you about the 50m and don't deny it's confusing. But I also believe that quite a bit of the cash will be set aside for employment and other costs associated with keeping the lights on at Cascabel, which is essential both in terms of pr and making the asset attractive to bidders. We could not mothball the place and expect to achieve a decent price.

Q, no, it should remain where it is as it may help your argument.

these are the indicators:
1) Publicly stated intentions from Sangha, CGP, DGR and Berry Street.
2) Media reports.
3) Cash position.
4) Management situation i.e no full time CEO, CFO or personnel flunkey.
5) SR.
6) State of debt market (although this is a current concern)
7) Inability of a small explorer to take things to production.
8) Composition of new board i.e we are now in the hands of CGP.
9) Reality.

For the Productionistas.
1) Continued reference to funding in SR.
2) Reference to hydroelectric power (for Q)
3) What the company has said up until a few weeks ago (we know this was BS especially as we now know the board have been in discussion with CGP since the summer)
4) Current share price.
5) erm....

Please feel free to add.

I thought they had too, but I can't see anything on their web site relating to a cash raise. As at 30th Sept they had $1.7m in cash.

RK, sorry, just realised you were referring to the director purchases.

RK, not sure what you mean.

I should add we will have to keep quite a lot to one side to pay for any documentation which becomes necessary as a result of a transaction.

CGP will be paying $8.3m in fees related to the transaction, which I'm assuming will be paid post-merger by the combined entity. Our fees will not be as substantial as we're not producing a document, but let's assume they're a few million dollars.
So, approx $10/12m of the recently raised $36m will be spent on the deal. Given that the royalty funds are hypothecated, there wouldn't appear to be a huge amount left over for an extensive drilling campaign and general expenses. Yet another indicator as to the intentions.

ToS, my take on that is that DC wanted to spend many more millions producing the DFS, whereas CGP didn't. I'm sure it's their belief it would not add any value.
I said it the other day, but I'm convinced DC left because he didn't buy-in to CGP's demand for an SR and additionally their unwillingness to progress the DFS. The only conclusion one can reach is exit.