Member Info for bluerill

fwiw, there seems to be very little selling interest down here

https://soundcloud.com/user-596578261/vsa-capital-podcast-episode-41-with-larry-zulch-ceo-of-invinity-energy-systems

Invinity Energy Systems Raised to Buy at Investec; PT 125 pence

(Bloomberg) -- Investec analyst Marc Elliott raised the recommendation on Invinity Energy Systems Plc to buy from hold.
PT set to 125 pence, implies a 28% increase from last price

https://www.londonstockexchange.com/news-article/TSI/financial-results-for-the-year-ended-31-march-2020/14700885

Looks like the company simply mistakenly announced a repeat interview which is, as someone else has also already pointed out, is a paid-for commercial service, 'Red Chip', which is a US equivalent to several popular ones like 'proactiveinvestors' in the UK. There is no such show scheduled on Bloomberg TV for 11pm our time/6pm EST this evening.

And while we're at it, why don't we use that crucial fact check to then 'check-in' (get it?) with everyone's favourite antidote to stuff and nonsense: Fun With Numbers! At present, Eroton and Jite could pay 50p for the 87% of San Leon they do not already own through Midwestern, and after netting out sle's current cash in the bank and then the contingent cash owed next year that Eroton will naturally no longer need to pay, they would be buying the OML operating business stake, the stakes in the pipeline/FSO system, and the PVR NPI, for a bit over 90m quid. But wait there's more, bc of course, as with the OML18 purchase, the deals to acquire the 15% stake in Oza/Deckar and the (as yet unappreciated but nevertheless massively accretive) 10% stake in ELI and the new ACEOS system ,were structured as LOANS of $7.5m at 10% for 5years and $15m at 14% over 4 years, respectively. Those loans of course are repayable in cash principle plus interest, so a rough estimate is that Jite's cost of acquiring San Leon at 50p would be FURTHER reduced by around $34.5m after 5 years (there is a one-year interest moratorium on the ELI loan), or around £27m. So all told, Jite-Eroton would be looking at a net cash outlay of just over £60m to do this theoretical transaction, before ANY production contribution in the next few years from the 3 major assets which are expected to be substantial and thus bring his net cash outlay down further still. Thus, in this process then of paying an 85% premium for the San Leon shares he does not already own for a net consideration of mere millions, Jite would be acquiring 10% of an asset in OML18 alone that we know he values in the billions, with a 'b'. Is something like this in the offing? Probably not, at least in the short term, but it does serve to demonstrate in simple, empirical terms just how much upside sle shareholders possess even in today's weak market conditions, and despite the share's 18% percent return already this year, led by a sector-shaming capital return of 33m.

that's the closing price of 27p cum the 6p divi. #fightfakenews

The 5m (of the 10m) is still to come I believe, which will take our cash balance back near 30m. Buyer(s) is/are still around. bs - firstly, you and your delicate little ego which tries to puff itself up by pretending you are some kind of honest broker who insults me and transparently bad actors in the same sentence, can well and truly kiss my skinny butt. You're clearly incapable of simply recognising someone may know better than you and furthermore provides insights and opinions based on that knowledge base. Instead, all you offer is the cynic's answer to everything: 'trust no one except me because, after all, I trust no one,' and by doing so you seem to think that raises you above the fray. Well, I'm afraid it doesn't. All it does result in is a slurry of false equivalences, flaccid commentary, and logical fallacies.....Meantime, the new evac system is being built during the teeth of the pandemic but the company is holding to its previously disclosed completion schedule, which is Q4 this year.

there seems to be a decent buyer stalking the shares. nice

I'm not new to kefi either, and the number of shares is irrelevant to the economics of a raise, and 'dilution' is a very poorly understood concept among retail investors, which I'll deal with in a later post. The main issue right now is that 4/5 months ago the world, but most particularly the market, was in a desperate state. Almost ANY company that tried to raise money in early May was looking at a deep discount on the pricing if they were to be confident of getting it away. Kefi management perhaps panicked a bit under those circumstance, and that's on them to some extent, but this was hardly unusual, especially for small, pre-revenue resource companies which are always thirsty for cash. If you don't understand just how parlous the condition were at the time, then of course you're not going to understand how dramatically those circumstances have improved, especially for Kefi who have delivered on proving up their assets. Read the RNS more carefully. Funding operations is not an issue and if they have to tap the equity market, there will be significant demand at prevailing prices.

I'm not 'new', been in the shares for some time, not that that matters a lick. In fact, it's you that's showing his relative naivety. You may think Kefi's benighted early history is somehow unique among greenfield resource companies, but it isn't. Management's missteps, even where you think they 'lied' on funding, were pretty much as common as dirt in this space. Welcome to the world of early-stage mining investments, girlfriend. What is unusual in fact, is the speed with which the company has advanced Ethiopia and now, a promising new discovery in Saudi. So I tell you again: this is now a 35m market cap company with multiple high impact assets and any need for small million pound raises going forward will get done quickly and without any difficulty (or discount), making a mockery of your needless history lesson.

and another thing; the issues around 'funding' for this company revolve ENTIRELY around large-scale project financing. At ANY point in time, given the enormous progress it has made already, if the company needed 2,3,4m quid to fund working capital, I know half a dozen guys would back an equity fundraise in a heartbeat and at little or no discount to the prevailing market price. Some of you have to try and rid yourselves of this idea that a small fundraise like that would involve some kind of catastrophic discount, just bc the previous one was handled so poorly. This is a completely different company now and ALL that matters for the share price is securing major project financing , not tiny raises that may be needed here and there along the way.

I know I haven't posted here before, blah, blah, blah, but for the record, I reckon the reason the shares had such a torrid session, particularly in the late morning, was bc someone(s) overreacted to the 'going concern' section of the footnotes in today's results. I read a number of your posts, though not all, and didn't see this mentioned anywhere, so I apologise if it was. Regardless, I'm pretty certain that - though a number of you mentioned that the market today and yesterday has seen some pretty aggressive selling in small cap AIM across the sector spectrum, particularly those names, like Kefi, that have seen substantial gains over the past few months - the special sauce with this name today was, I'm confident, that one or more holders read that pretty standard language for an early(ish) stage resource company and basically panicked. Ironically, as I have read a million of those auditor-required provisions (usually when cash on hand is less than a year's worth of estimated working capital), and written a few, Kefi's was in fact, pretty bullish. It makes it clear that the board's decision that it was '...appropriate to prepare the financial statements on a going concern basis....' was based on the company having MULTIPLE funding options. What was a bit unusual about Kefi's disclosure in this section was that it was very, very long - 6 paragraphs worth! - with probably more detail than was truly necessary, and it is very possible that our aggressive seller(s) today was/were thinking that somehow the company was trying a bit too hard to convince the market. Regardless, it was in my view, a complete misreading of what was in fact, a pretty puckish outlook for funding the company short- and long-term.

NOTE: I don't know why my post ended up with this '*************', as all I wrote was that the deal between TSI and BS is based on an 'exchange of shares' (thus the phrase 'share for share' in the RNS), which for some reason got edited out

Sorry, the main components of your post are not correct. Right now we can see that is essentially an RTO - which is just a fancy way of saying 'merger' where the private entity, in this case BS, is deemed larger than the acquiring entity, TSI - based on a ************** between BS and TSI where the two parties would doubtless have already had extensive debate as to the appropriate 'exchange ratio', essentially how much of the combined company BS shareholders will end up with. In other words, TSI will issue a whole lot of new shares and give them to the private shareholders of BS in exchange for some as yet unknown percentage of the 'newco'. This exchange ratio is the major bit of info at this point that we will be anxious to learn about soon. The fundraise in all likelihood will be a relatively modest amount for working capital for the new, larger entity, and NOT for the purposes of funding any part of the 'purchase' of BS.

'....Don't worry about that iam confident they've got plans in place. Supply would've been #1 concern with the plans to roll out across the USA and Europe....' Not exactly. Happypennies has a point; several in fact. There's no way a company this size will be able to supply anywhere near that many (potential) sites, at least in the near-term. It will clearly take time to develop the kind of manufacturing capacity necessary to meet (potential) demand. As for how they finance that production upgrade however - another very relevant point from happy - I don't believe the company will have to come anywhere near the equity market for finance. This types of contracts with these type of distribution channels, are like catnip to credit providers.

I miss him already

What in the f*** are you on about? WHAT IS YOUR POINT? Do you ever have one other than a mania for trying to develop a kind of personal brand for above-it-all 'balance'? What is the purpose of making such otherwise asinine rhetorical statements like 'Nigeria - business as usual!' or asking 'what exactly is in the risk management contract?' and then answering it 'I guess we'll find out' after cutting and pasting basic deal information that everyone who's interested would have read already??? Because I'll tell you what it seems like you're trying to do to me: it looks to me very much like you enjoy swanning in periodically to try and promote yourself as someone above the fray, with a focus on what's 'really' important like the realities of doing business in Nigeria (which, by the way, have been precisely the opposite of what you love to imply. More specifically, I think you know jack about Nigeria and doing business there, but like to pretend otherwise while ever-so-subtly spreading fear and loathing. This despite ample evidence that Nigeria has for the last 5 years been a consistently solid jurisdiction for sle. Shame about the pipeline vandalism I know, but that also is being addressed of course, so why don't you, for instance, next time you feel the compulsion to share some old, gloomy comment about Nigerian practices, instead compare tax policy treatment for UK O&G's in the North Sea to those like sle in Nigeria over the past 10 years and then post about that? You might just learn something) Or then there is your other favourite: appearing suddenly to reprint something I've written and follow it with some kind of nasty backhanded compliment. I have news for you: you are not an enigma or some kind of noble truth teller. You're just a grubby little troll with a wounded ego....This is a very low-risk (though slightly riskier than the deal for OML18 or the pipeline deal with ELI, but those were special) investment in an already significantly developed field that was mouth-balled due to the operator running out of funds, a circumstance as common as dirt in the O&G biz all over the world. Absolutely NOTHING unusual or out of the ordinary here. The investment - again - has been structured as a loan-to-own where the cash sweep assures SLE effectively of first dibs on earnings coming off the field which, as it has been designated 'marginal' by the NPCC, it has significant tax advantages, making it that much more likely that we will see payback. Our company's risk IN TOTAL is $7.5m and so far, given the way the deal has been structured but even more so what I read about the asset, I reckon the potential reward more than justifies it. Period. That's my view. WHAT. IS.YOURS.?

Malcy says; San Leon Energy San Leon is to provide funding for the development of the Oza field in Nigeria via a funding model that gives it opportunity to provide a repayable loan at an attractive interest rate and with an additional significant equity kicker. This gives SLE the opportunity again to generate a meaningful return from repayments in the coming years as well as looking forward to a longer-term dividend return from the equity shareholding. The starting point is subscription agreement with Decklar (holder of the Risk Service Agreement to the operator) for a $7.5m loan at 10% p.a. coupon as well as the opportunity for a 15% interest in the company. In addition the agreement allows San Leon to increase the loan notes by another $7.5m and the equity by another 15% to give them 30% of the equity in due course. Put simply, this is another deal by which San Leon invests with limited risk into an older, marginal field albeit one with plenty of seismic and therefore upside. As it is onshore the wells are relatively cheap and have few if any issues commonly associated with offshore or semi-offshore in the country. This deal will be decided as to commerciality pretty quickly, the first well will give the option to scale up the investment, following receipt of the result of the new drill proof-of-concept well after, say, c.90 days. Obviously the way the option is structured it would be possible for SLE to walk away if things don’t go according to plan. With wells producing 2,000-4,000 b/d it is possible that a 20,000 b/d total might not be ruled out for the investment. So for a relatively modest outlay and very limited risk, San Leon has outlined another potential investment with high rewards. Returns should come from the coupon on the loan note but also from what might be a 30% investment at extraordinarily low outlay in Decklar. The shares have more than doubled from the lows but at 27p the shares still offer exceptional upside particularly when the management do deals like this.

http://pdf.reuters.com/htmlnews/htmlnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20200901:nRSA5451Xa