Member Info for BorderBob

From today's market it seems obvious that people who buy based on newspaper stories are readers of the Daily Mail, not the Telegraph.

@Stevegrass "They need to purchase enough shares to trigger the takeover compulsory purchase"

Doesn't that mean they have to offer a lower price than what is already on the table? And there is no compulsory shareholder sale. I'm not yet convinced that Ganfeng wants 100%. They might want only 51%, at a lower price, to prevent some other investor from becoming their partner.

Most of what I have been saying here was published last September:

https://eandt.theiet.org/content/articles/2020/09/mexican-drug-cartels-could-mess-up-the-country-s-most-important-lithium-project/

If investors didn’t want the facts then, I suppose I shouldn’t have expected anyone to be interested now.

I will admit that I have small investments in several other clay projects. The discounted prices reflect the uncertainty of results. As for BCN, it’s not about how much I have invested, it’s how much I have saved by confirming my doubts before committing more funds.

Demand for LCE (lithium carbonate equivalent) in 2025 is projected to be nearly a million tons. Bacanora is planning to maximize production by 2025 at 35,000 tons a year. That seems to be the most that its infrastructure can support. Please correct me if I’m wrong – doesn’t that mean we’re talking about 3.5% of world production, even if this wonderful processing plant actually becomes operational? So there could be 25 competitors with equal or greater output, many of them trying to sell in the EU market where batteries will be rated by their carbon footprint?

If BCN is closer to the bottom of the list of lithium vendors by annual output, why are a few people so enamored with it?

Au contraire, it is your civic choice to entertain me with what happens when people fall in love with their shares.

Remind me who made the statement that it was directly scalable. Wouldn't be your favorite people in the world, the Board, would it? Or maybe Ganfeng technicians. They would have to be reliable, right, because the Party would expel them if they weren't.

"Indutrial" ? Sounds like shorthand for the Salt March. Of course that happened nearly a century ago, even before Mexico nationalized oil. A laboratory can be an entire building. A laboratory can be used to test an industrial process. How many 20-kilo sacks of lithium were produced, at what cost by how many scientists? And how many independent third parties were allowed to watch?

You mean it was done entirely outdoors? It was 40 degrees C yesterday in Bacanora, I think they should allow their tests to be inside a building.

Definition of laboratory from Cambridge Dictionary: a room or building with scientific equipment for doing scientific tests or for teaching science, or a place where chemicals or medicines are produced

@mrcautious - Many things that work in the lab don’t work as well when scaled up. In the lab, zinc is a practical replacement for lithium. But I like your analogy to airplanes. Maybe the BCN process will be the British chemistry equivalent of the Comet. (I once flew on one, in Mexico. The comic actor Cantinflas was also on board. We both survived.)

No one would watch a public debate because they have all been advised to filter me out as a troll. I will continue to comment where I want, when I want, and you can feel free not to respond to my questions. Like, name a place where clay mining has been shown to be economically feasible.

When will you start calling silver a rare earth? When it reaches $30 an ounce?

Mexico is looking to Bolivia for guidance on regulating and taxing the lithium industry. Mexico’s ruling political party is recommending that country’s policies since 2006 as a model. You may think 84 years is nearly a century, but it’s well within the lifetime of your current constitutional head of state.

The nationalization of oil is no more a distant memory in Mexico than the Ottoman genocide is a distant memory in Armenia. I have been a student of Mexican history all my life, and would be wasting my time debating it with someone still living in the colonial past.

“There is lots of lithium.” Agreed (please educate your minister who referred to it in the Tmes as a rare earth).
“Cost of processing into battery grade.” Agreed.
“Costs of licence and taxation required by host country” Agreed.

“Cost competitive for battery grade Lithium processing.” How do you know that? It’s not rock, and it’s not brine. It’s clay. Where else is clay being extracted at a reasonable cost?
“Licences agreed , Taxation agreed.” That’s certainly what the foreign oil companies thought back in the 1930s when Mexico nationalized the petroleum industry.

“The moment those purchase hit the market the price would likely go higher.”

Credit Agricole seems to have been able to accumulate its 2% of shares with little affect on the market price. Ganfeng may have gone to the Board and offered it a choice: They can just start buying as many shares as the market will sell at 45p, or they will make an offer at a 50% premium. In hindsight, Ganfeng now knows that it probably could have bought as many as needed for 50% control for much less than 67.5p. Live and learn.

Meanwhile, here’s a five-minute video from the Australian broadcaster about the history of medical lithium. I did not know until recently that it was once an ingredient of 7-Up, and some people think that soft drink’s name comes from the element’s atomic mass.

https://www.abc.net.au/news/2021-05-29/the-history-of-lithium/13364208

My nomination for pointless idiot would be the person who wrote "They also can only get to that number via buying shares in the open market because of our board attempts to give them more stock via a placing the regulatory bye bye secker freedom.
To be is around 55p today and would require same terms indicated at 50%." But maybe you can translate that.

The irony here is that while some British investors are looking to Mexico for lithium investments, others are more interested in what can be found in a day's drive. And, apparently the British government is underwriting some of the exploration cost. An interesting article published today:
https://www.nationalgeographic.co.uk/science-and-technology/2021/05/in-cornwall-ruinous-tin-mines-are-yielding-battery-grade-lithium-heres-what-that-could-mean
They're finding lithium in the Rhine Valley. The Thames was once a tributary of the Rhine. What if large deposits are discovered, under the City? They could draw attention away from that by pointing to Mexico.

From what I can figure out, the Ganfeng offer is made under a “Scheme of Arrangement” whereby they need the approval of 75% of the shares other than those they already own. So, to oppose it you need 25% of 70%, or 18%. That’s about 67 million? Keep trying.

But does Ganfeng really want 100% of the shares? Where have they made that a condition of their preliminary discussions? Let’s try to look at this from the viewpoint of the Chinese. What if their spies had discovered that a wealthy American was going to make an offer for BCN? Let’s call him Sunk Mole. They don’t want to be his partner because they need lithium, they don’t need cash from selling lithium.

So really, all they may want is more than 50% of the Bacanora shares. Less cash, same amount of control. Would that still allow BCN to be listed? I don’t know.

It seems that some shareholders have been offended by the standard language of the offer announcement, which starts with “The Bacanora Independent Directors [and Ganfeng] are pleased to announce....” This is like oral arguments in court starting with the phrase, “May it please the Court,” which traces back at least to 1606. Find me an announcement from any Board that doesn’t start out with them being pleased, not with the contents of the announcement but the opportunity to politely make it known.

The announcement also states, “The Bacanora Independent Directors are not obliged to recommend an offer by Ganfeng at the Offer Price. It is therefore possible that the Bacanora Independent Directors could decide against making such a recommendation.” Some shareholders seem not to have read that far before starting their attack on the Independent Directors (a group that leaves out the two Ganfeng-appointed directors).

@dan Of course I am aware of it, that's why I bought at the market price that reflected the lack of interest from other investors in helping BCN raise the money it needed to continue with the project. But now you want to criticize the Board for decisions made and explained long ago. In my country that is known as "beating a dead horse." The market price actually rose somewhat after the market swallowed the large serving, right? As normally happens in such cases. The company was undercapitalized, at least after Covid threw what we call a monkey wrench and you call a spanner in the works. Many people saw the value of many speculative investments decline. Most don't try to blame their Boards.

@dan "Please explain to the class why the market price was where is was Bob"

My understanding is that there is a stock market in London where sellers offer their shares at a certain price and buyers offer to buy them at a certain price. When an agreement is reached, that is where the market price is. However, it all may be rigged, like a SpiderMan movie. There is no telling what really happens in London these days.

It's ignorant to bad-mouth the Board when their lips must remain mostly sealed during an offer period. They were presented with an offer of 50% more than the market price -- compare that to the Carlyle offer for Vectura, at only 30% above the market price. What do you propose they do, turn it down and be attacked for breach of fiduciary duty because they're just trying to protect their jobs? For all you know, they're on your side, but had no choice -- especially now, considerng the giant yawn with which the market has greeted the offer.

@Fonz "unless I’m mistake for a delay to be issued both parties have to agree with it."

Of course Ganfeng would have to agree -- there's nothing to have prevented them from making the offer weeks ago. But the request, if any, comes only from BCN. How much must they divulge to the Takeover Panel, and to shareholders? From what I can tell, a delay is often requested when another offer is under review. Must they tell what it is, or who it's from? Maybe we will find out. Or the Board could be negotiating some of the details with Ganfeng. Do they have to reveal the issues and proposals? Probably not.