Member Info for Bozi

Redknight - I'm not following your thought process here.

What difference does it make to anyone if the Imbabura province assets are retained by SolGold and everything else spun out?

Cascabel is the main driver of value.

SolGold (Cascabel) can then be sold for c.95% of the value the full company would be worth. More acquirers with just an interest in Cascabel would potentially come to the table which betters the chances of getting a bidding war.

A full sale doesn't suit everybody. A spin off can work for everybody.

Agreed rcgl2.

I won't dispute any of that Orthern.

But a sale of Cascabel, even for 40-50p, gives everyone options. Whether it's full cash or part cash part scrip.

The risk from our side as investors is we get strong-armed out of Cascabel on the premise that it's economically a bit marginal for anyone looking to borrow to fund construction only for the acquirer of SolGold whole to go and find a blockbuster tier one in one of our other areas.

That would be a sickener for me.

Add - I appreciate why you say that - some will be disgruntled at not being able to sell NewCo straight away but they'd have to just lump it whilst SOLG got prepared. Plus, if a demerger was done 1:10 then any NewCo holding would only be minor anyway, assuming that the company carried an opening value of £20-50m.

The main benefit is that everyone would still get their sale of Cascabel. It also paves the way for the likes of Mitsui who might have just an interest in that asset to compete with the BHPs and the Jiangxi's.

NM wouldn't be in the chair for me. I'd appoint independently. If there's any managers of promise in SOLG then I'd consider them along with the rest of the labour market.

Good posts Mike, just had a read.

Irwin is undoubtedly close to the action being a significant holder of CGP and I'm sure he fancies himself as a dealmaker as well.

I definitely thought it was worth raising again on the premise that I can't see a downside for anybody.

That would be disappointing Orthern.

Flogging the lot in one go is the lazy approach and cannot possibly be the best way to attain full value for all shareholders.

With a full sale, plenty of shareholders who aren't desperate for an out, lose out.

With a spin out everyone gets to make their own decision and NewCo can still progress in Ecuador.

The IPO isn't important. It just needs a company creating, the assets rolled into it and a corporate action to do a demerger and maybe even a rights issue.

It's a no brainer.

Add - I don't disagree at all on that.

But what is stopping the following:

SolGold announces completion of strategic review and announces two initiatives.

1.) SolGold decides to proceed with a spin out of the regional licences into a new vehicle. It names a full management team and board including new people.

2.) SolGold updates the market on offers for Cascabel and surrounding licences.

Shares of the spin out company would probably be unlisted to begin with, with an IPO tbc. SolGold would likely allocate a small amount of cash to NewCo for G&A and maybe a small budget to carry on working at Porvenir and attack the next licence with the necessary permits.

SOLG shareholders could be awarded shares in NewCo at a rate of say 1:10 SolGold.

NewCo then does an IPO after say 6 months with the necessary knowledge and expertise in situ.

In the meantime everyone gets their payout from a SolGold sale and can then go do as they please with those funds.

Once NewCo IPOs everyone can then stick, twist or bail.

This is something Atlantic Lithium have done in the last 12 months with great success. They now have a quality and growing lithium asset packaged up and gold (and lithium) assets in the spin out.

It sticks to the 'next cab off the rank' mantra and it gives shareholders multiple bites at the cherry.

I can't see any downside to this. Can you?

There's no way Fawzi would answer a loaded question like that - not with any substance anyway. It also wouldn't be a fair position to put him in.

Just my view of course.

As we saying Bob Sangha can manage a billion dollar tender process but not an IPO of an exploration NewCo?

Come on fellas.

You probably have Fort as you tend to cover most bases which is fine.

I wouldn't sell Cascabel to the market. I'd sell it to whoever wants to buy SolGold. That part wouldn't change. We'd just be removing the high priority regionals from the package.

I'd just be keen to hear the rationale from SOLG in terms of selling the company for X over selling Cascabel and surrounding licences for say 90% of X and continuing with the NewCo.

I don't think it stacks up unless SolGold can attract a bidding war that pushes us over 100p for the lot, and the merits of that are debatable obviously depending the side of the fence the individual sits on (Redknight vs Stackhigh).

You may be right DBW, but it would be a shame to see the company sold when there could be so much more value to be created for those happy to take the risk over the medium and long term.

For example, it shouldn't make a difference to anyone wanting a sale whether just a company holding Cascabel and other local licences is sold because nothing else is carrying much value anyway.

Newc can then start again and give those inclined another bite at the andean cherry.

I don't know if this scenario really appeals to you personally but I've been giving it more thought and I'm really keen. I just think it suits everyone equally.

*spin out (predictive text).

Quady - it isn't for SolGold to manage the share price.

SolGold management manages the company. The market sorts out the share price.

We should be asking the rest of the market.

A sprint out provides the fairest short and long term value for all.

It has Addicknt. I accept it isn't new.

I just don't think I'd really considered it, but now I am as I'm of the view that the price we'd get for an outright sale wouldn't be an acceptable return for some investors.

I was talking to another esteemed member of this board last night and he raised a good point that i hadn't considered.

A spin out of Cascabel really would be the best outcome here.

Bob could take everything except Cascabel and the surrounding licences (you know, the ones we disputed with CGP) and spin it into NewCo. SolGold then gets marketed for sale. With the protection of the existing agreement with Lasso.

The rest including porvenir moves into a NewCo which has the clear remit of going back to exploring the fantastic potential of Ecuador.

Every shareholder gets a pro rata slice of NewCo which carries out a financing to go exploring again.

This should suit everybody. Cascabel is widely acknowledged as the asset carrying the value. Sell it and let those championing a bid for the whole company walk away with their profits. If they don't want any part of the continuing story then they can simply sell their holding in NewCo.

Those who don't want all of SOLGs assets and licences flogged for a paltry price can then roll the dice again with NewCo, where should another significant asset be discovered, it will just about be ready to be the next cab off the rank come the late 2020s copper boom.

There you go Bob/Warren - job done. 50p will be palatable for Cascabel all things considered and we'll keep the rest, thanks.

Well said Bob!

*Head of HR

As for the AGM notice...

Head of HT gone and not being filled. O'Kane and Goodey not standing for re-election either. Board of directors being decimated, all the while the CGP proxies get their feet right under the table...

So we've just taken $50m from Osisko and pushed back on all studies yet we're taking $36m more for equity down here...

Make it make sense.

2Luke - I don't disagree with you on virtually of that.

I'm just trying to make the point to CovGaz that when he buys in 7 years ago 3-5bags was probably a reasonable expectation over the time horizon.

Obviously things haven't worked out that way for reasons we all know about and that is another source of immense frustration.

Price is where it is for the exact reasons you mention. A severe discount is being applied because the market knows SolGold has no ability to bring this asset through to the production. Recent RNS' on the strategic review are the company agreeing with that view.

I agree that it's ultimately sensible that the company re-prioritises and takes this line now so as not to burn through the Osisko funds.

On your final point, I'm not sure how coy Mather was. He was trying to build SolGold into being the next major producer and he got crucified by those investors (like CGP) who didn't see the same vision for the company/asset and wanted it sold then. Mather was accused of letting his ego get in the way.