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" potential modification of its asset holding structure which would ensure distinct ownership in the various jurisdictions in which the Company operates. "
I think the issue with the shareholder conundrum is to misunderstand what the 'split' means. This is not taking one company and developing subsidiaries owned by a global parent company (IAG model for example). That still leaves a global company with Russian assets. Splitting means creating two separate companies, completely unconnected in a deal where MOEX holders end up with all the Russian assets in their new company, XYZ, and LSE holders end up with all other assets in their new company, ABC. POLY might not even continue as a business name in either separate enterprises - the name maybe seen as tainted already. Neither set of shareholders in the new companies has any ownership of the other in terms of shareholding. Shares allocated, or rather converted, in the new companies is based on the number held on a particular split date. In your portfolio, for LSE, one day it says POLY shares, the next day it changes to ABC shares with probably a sharp change in valuation.
"distinct ownership in the various jurisdictions". The details of how the single POLY is split up into XYZ and ABC is of question wrt debt and estimating value and how shares would be converted, one for one or rationalise 5 for 1 or whatever. If a shareholder has shares in both markets, they simply become a holder in two new companies.
The other option is selling assets (including debt). Here, whoever wins the bid on eBay for mines, leases, debt, equipment, spares, offices etc physically located in Russia takes ownership and all that stuff is taken off the POLY balance sheet. It no longer exists as owned by POLY, but when the PayPal payment clears, a lump of cash appears in place of the assets in the accounts. POLY as a company doesn't change and MOEX and LSE holders have shares in a company that is now lighter on assets but cash rich. MOEX holders don't get any shares in the company that won the bid. The issue for this scenario is the MOEX holders are in the exact same position re being paid divvies, and getting a good price for the assets and selling the debt as close to book cost as possible. There will also be the matter of getting the PayPal payment transferred out of Russia (assuming it is purchased inside Russia, say with a MBO!
I don't think the scenarios resulting in cross-collateral ownership work as LSE POLY is still connected to MOEX POLY and hence the toxic asset is still on the books.
Note, a MBO only works for the selling of assets, not for a splitting to two new companies as the existing management already own stock and therefore have nothing to buy, whether it be in one or both exchanges.
From the list of companies exiting Rusia, not easy to use as there are no hyperlinks to the categories section, but the A list of total withdrawal towards the bottom of the list makes for interesting reading. Of note is this, Lloyd's Register withdraw services to Russia Industrials/.
I wasn't aware Lloyd's had pulled fully. For a mining operation like POLY, insurance is a major consideration due to the speculative nature of exploration and the industrial scale process and potential failures (tailing dam bursts for example).
I posted recently specifically that divesting Russian assets is needed to safeguard things like credit rating and maintaining business relationships with Lloyds (I even started Lloyds too). Looks like being able to demonstrate non-exposure to toxic assets is more important than I first thought.
Would POLY be alone in breaking ties with the Russian side?
This is a comprehensive list of the companies that have withdrawn to date since February. The authors blow their own trumpet that their list is passed around boardrooms and influences decisions. Has the POLY board been passed this list and has it influenced in any way?
For a better understanding of the probability sanctions may or may not be lifted, here is the Wikipedia link detailing sanctions since 2014 Feb 2022 sanctions are actually the fourth round. So if Russia continues to occupy Ukraine, the probability current sanctions will remain for as long as there is occupation is extremely high. POLY has already advised us there are consequences for the operating of Russian assets and selling product which require have require changes to financing arrangements, inventory management and the need to extend storage capacity of refined bullion (which has an increased security risk). There may be further sanctions in the future that may impact even more directly. Given the statements and actions of Russia, it seems extremely unlikely unlikely these sanctions are going to be lifted for many years, if ever. Th company cannot continue to be impacted as it has from indirect sanctions as it has so far, let alone when new sanctions impact directly due to the Russian assets. A split or disposal sooner rather than later is surely the best move.
It keeps being stated that splitting the company or selling off Russian toxic assets would take months or even years. Why? There has, by the RNS declaration 19th July, already been many months work towards it. In fact it is merely a matter of a few legal issues to be ironed out and sounds very close. There is absolutely no reason for delaying to any results date. It sounds much more like a sooner rather than latter event. The potential for further sanctions may also accelerate the split process to avoid further complications.
Also, when reading the 'management speak' in the various RNSs, 'in the best interests' usually means be prepared to take a hit. I think that is more for the pre war holders and the reality that the final deal will result in a substantial relative difference to pre war sp and divvie. However, all scenarios deliver that so it remains to be judged whether the "modification of its asset holding structure which would ensure distinct ownership in the various jurisdictions in which the Company operates" leaves pre war holders better off compared to the company doing nothing.
"Our plan has evolved since the Company announced the genesis of these actions almost four months ago, and I am pleased with the good progress so far. While we are dealing with several legal and regulatory aspects across jurisdictional boundaries, our aim is to apply best corporate governance standards and achieve the best outcome for all stakeholders”, said Paul J. Ostling, "
And a small footnote for those believing war end would equal sanction end. How many sanctions imposed on Russia during it's aggressor history for the last couple of decades have been lifted? Should Russia consolidate the objective and occupy Ukraine territory, on what basis would sanctions currently applied be lifted (based on historical evidence)? I argue the long term consequences of the war are such that holding Russian assets will be detrimental to the business as sanctions may be applied for decades as long as it is deemed Russia is occupying territory illegally.
Foor, when the RNS stating the split/sale was being proactively followed the argument was basically proven and therefore continuing to post intimate details of the war and potential progress and outcome became increasingly redundant. Also, I felt compelled to counter the persistent attempts to justify the war by the Kremlin propagandists. I finally made the most compelling point with the link to the story and picture of the 4 year old girl in the open coffin.
As some would say, 'nuf said.
Following on from that I have concentrated largely on the debate about what kind of split and why it is the best long term option. I remain obliged to counter posts that mislead although I take onboard the feedback about being focused on POLY. I am not a good fish.
If I must stay on target, I will be much more proactive in reporting when others are not. I raised my concern over the editing of content and organised trolling of the board with admin yesterday.
We will see if bans were 48hr temporary warnings or permanent by Friday.
Despite the very low volume, it is encouraging to see A trades, automatic. Means significant investment operations are keeping logged in expecting opportunities. Automatic trades with the spreads we see! Interesting.
If the reserve transaction tangible returns to being gold, mines are practically money printing presses, as it was with oil. Production of the raw material underpinning the world economy. The decline of oil is being forced against the market (the zero carbon stuff) therefore the oil dollar, oil Rubel and others should have a decline in value.
What argument can be made against the gold 'dollar'? Gold may have a future but it is geographic in nature, which brings back the debate back to square one about the stability of where your investment is. KZ POLY will have substantial value, but will it be fully realised with an unstable Russian neighbour? Like it or not, much wider topics must be taken into consideration for strategic portfolio investments. I have a poor track record with mines and prospecting companies of various minerals and oil simply because variables (topics) that seem distant and not connected turned out to have overwhelming direct impacts.
The attempts to introduce alternative reserve currencies will simply fail due to the extent of the dollar, so I expect a fallback to familiar gold for those trying to ditch the dollar as that is a tangible asset to back up the widget currency(ies) being used. I only see gold rising and rising, there is a potential the world returns gradually to a gold standard a decade hence. Not sure I will be hanging on to an investment in a gold mine that far into the future but the future might well be orange, a goldy orange.
I think if I was to put down a long term gold mine investment I would look for a very politically stable place to invest, somewhere like Australia which has some very productive reefs and large areas untested. Even post split for POLY, it's neighbour is Russia and that takes a lot of shine of the KZ investment long term for me.
I'm only here to pick up £4.50 from an average of £2.70 short term, I expect by October. But I will be following the alternative currency saga with interest.
Silence is golden. Either everybody has taken the day off or there has been a purge. Efforts to delete my account nearly succeeded, and I am sure the vile abuse posted later in the day was another attempt as there was a link in later posts to try and associate my user name with it. That, of course, was to encourage the organised trolls to make reports of abuse as if I was involved. Well it failed. There was a bizarre post deleted early on which still leaves me wondering whether the troll collective has truly been cleaned up.
As far as POLY is concerned, the sp is following low volume patterns. The digging in with sanctions and opposition to Russia doesn't seem to be spooking the market anymore. I think the low activity these days just means the iis are waiting for indications on how the breakup of POLY is to carried out, fire sale, split, or do nothing. The length of the war is clearly extended so early cease fires and peace deals are off the table so no magic market bounce back to be expected.
"Investment services. Providing investment services "
How will POLY not provide funds for projects? Unless the Russian entity is to be completely, utterly and 100% transparently self-funded, then there is a breach there. To be that independent basically means split up. Whilst this applies pejoratively to 'new' investments, further down the road, war or post war repercussions, it only requires a minor tweak it make it applicable to existing business. There are many examples where businesses are told to withdraw from a territory due to changes in the political situation.
Also, the anti terrorist legislation can be used. Well, it was used against Iceland in 2008 to seize assets and Iceland hadn't invaded anybody!
Looking down the road, there are many issues and problems having any connection with the Russian assets, and I know it upsets people here, especially the patriotic Russians looking in , but the company is better off dumping the Russian assets as soon as possible. The war has changed everything, there is no going back. No amount of complaining to the moderators or emailing admin is going to change that.
You will have noted, the thread has been deleted. That really underlines just how heavy handed this is being edited. Can not even seek a consensus or clarity of what is the definition of off topic. Moderation is completely out if control.
Very few trades, very few posts, everybody watching their ps and qs? I find the idea that Big B and 'gang' rule the board pretty amusing bearing in mind the hundreds of posts the activist community have removed. I reported one post earlier today, and despite the off topic nature, hasn't been removed, but then again it follows pro Russian propaganda and so is proving a point I have raised elsewhere.
What is off topic? Maybe " some optimism about why how the sanctions may soon relax." is off topic and so somebody complained. Are sanctions therefore not relevant? I would argue, given that sanctions have severely impacted the supply of spares and consumables resulting in increased debt and negative impact on sp, sanctions are relevant. But then again, I don't support the war against Ukraine and therefore shouldn't be posting an opinion anyway.
" just get tired of people buying into propaganda of big oil companies."
Would you like to show me some of it? The whole bias in media was supposed to level the pitch for the environmentalists against billions of oil propaganda money. Nobody has ever found this money, nor the propaganda. Most of the new analysis is in econ to the never ending escalation of of renewable subsidies, trillion dollar green handouts and the total open suppression of any question of challenge of anything said. The money cost is hitting ordinary people hard and mad cap environmental schemes are wrecking eco systems. Sri Lanka has gone bust because the government forced all farming to be organic to appease the green lobby and the agro-economy fell to pieces in just one year. Environmentalists interfering with natural back burning stopping all wildfires as much as possible ends up building up huge areas that then burn in one go - self inflicted environmental devastation in some areas. Fire is essential for regeneration and even germination in some species. There are a lot of think that need challenging but currently there is mass media lockdown. The cost people are paying tough is very slowly filtering through to the political classes but as shown with the Tory leadership campaign mass media has still got a strangle hold on the narrative.
olps, does government subsidy get included in the declared cost? Its like Concorde, operating profit if you don't add in the government money to design and develop. A lot of engineers around scratched their heads with some disbelief when the big declaration was made that renewables were much cheaper almost overnight. Is the cost of land and compensation included? There are some great sales pitch's around and impressive looking academic papers published, then used in the sales pitch. There is no research money for producing reports with awkward questions. The Spanish renewables industry had mostly collapsed within 8years as the Chinese are only able to produce cheap enough even with ever bigger heavily subsidised budgets. An awful lot of smoke and mirrors in renewables, as shady as the arms industry!