RE: Positive Reinforcement12 Mar 2021 07:29
Continued:
- Back in 2008 when I started to invest and specifically in the mining space, First Quantum bought across the border in Finland, a mine in a very early stage for approx $200mln with the same basket of metals as Monchetundra; the MPV from a really early pre feasibility study was around $90mln at a discount rate of 8%, but First Quantum bought this for $200mln based on the fundamentals of the metals, then they went and sold it on recently for $750mln.
- With the banks jumping in, i think they want to bring some competition, which i think it is healthy competition for all the shareholders.
- the fundamentals are good and are obviously helping us and raising interest towards Palladium, such as recent transactions taking place with Sibanye buying Stillwater mining for $2bln and Impala Platinum buying North American Palladium for C$1bln, with all those deals going on, there are not many companies left to give exposure to Palladium.
If you are looking for a Palladium company that is in Production which are not consolidated and listed in London, you dont have too many options, thats obviously helping us.
- Speculation on value: With CITIC and VTB on board they're not going to bring any small deals to us. The deals that have happened recently in the industry, are good deals to benchmark against.
- What would you not accept: Now the people that are interested in our Palladium, and now there are a lot of companies operating in the PGM space and obviously want exposure to Palladium because its fundamentals are very good, and we have open pit mines which is very different to a normal PGM mine, which is usually underground. We have a number of parties interested in Palladium open pit, and they know each other more or less, i think, and they know there is competition especially now the big banks have joined the process. I don't think we will see any unreasonable proposals, i think people are sensible on whats going on.
- How long may it take for a deal to be done: My experience suggests that it can be very different in timing, i want to highlight that we probably shouldnt rush, there is no need for us to rush, let the interested parties rush as this gives us a tactical advantage in negotiations.
- It says no guarantee of a sale: its standard qualification made a NOMAD, but the banks would have assessed their probability and wouldn't have joined on a success fee basis only, they do not want to waste their time.
- Are you looking for a significant return on your 5p investment: Not going to speculate on price, but we are looking at the offers and go for a solution that works for all shareholders.
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