Member Info for BubbyHuxter

Enjoyed the informative posts since yesterday that seem to point to a persistent 'tame seller' providing cheap shares for shorters to use to get out in profit or at least unscathed. But I still have a problem understanding why they would sell cheap; I understand why they might have to sell (Daisan's post at 12:13 today) but can someone help me on this:

If the 'tame seller' has such influence in suppressing the price why don't they stall selling for a short prolonged period, say 3 or 4 weeks and let market forces take the price higher into say, low/mid 30s. Then, resume their 'tame' selling status. Wouldn't that increase their sell price, by my example, to at least 25% more than they're currently getting.
Advance apologies if this is obvious but I don't get it - as a PI if I wanted to sell out I'd sell gently into a rising market.

@mgcro - excellent and insightful post on TPEP's "short'/ hedge versus VanEck's holding. I'd been thinking along similar lines but without a proper understanding just couldn't join the dots. You acknowledge it's a theory but its compelling. I get frustrated when folk ridicule shorters as complete chancers when the process demands great market knowledge and skill regardless of ones views to the ethics.
Also, informative posts today from Uksteveg and Expert and ophidian - learning stuff - just don't let it get spiteful! Opposing, well argued views tolerated by both sides makes for a stronger and less sensitive BB.

I've always struggled with understanding shorting. I've got to grips with selling what you don't (yet) own but I'm more intrigued about the reasons for doing it; is it merely predicting the share price trend (downwards) or is it done to actually engineer a decline in the price to accumulate stock cheaply for or on behalf of a predatory client? Not surprisingly, there isn't a single answer but I found some of the following linked items highly informative. This is basic research and I know there are many here who have a great understanding of shorting - these primer links are aimed at those like me and since BMN is definitely being shorted it's wise to become a little more savvy on the subject.

For what it's worth the main things I learnt were these: 1) Shorting is a very high risk practice so don't think it's done by idiots - it requires a lot of market nous and even large companies will instruct specialists such as hedge funds. 2) There are sound arguments for shorting and the practice can shine light on companies where for example, their price is over-inflated through rising too quickly. However, 3) It seems that there's a massive difference between "regular" shorting and concerted efforts by related parties to drive the share price down for nefarious reasons. My understanding is that practices like this (Bear Raids?) are potentially illegal. 4) The effect, not surprisingly is that PIs do sell thus providing the share needed for the buy back 5) On a positive note - unless there is something fundamentally wrong with the target company - LTHs who hold on to their stock are the shorters' worst enemy and will benefit most when the storm passes.

Excellent primer with Investopdia's Shorting Tutorial - Read ALL ten chapters listed in blue on the left hand side of screen for a balanced view.
https://www.investopedia.com/university/shortselling/

Does Shorting Make Stock Price Fall? - Very American with some alien phrasing but worth reading his view.
https://www.quora.com/Does-shorting-a-stock-make-it-fall

Interesting views from both sides on the morality & Does it harm a stock:
https://money.stackexchange.com/questions/100723/does-short-selling-hurt-companies-stock-price-in-the-long-term

UK Based (AJ Bell) look at Shorting with 7 case studies from late 2018 (interesting using our LSE site to check the predictions):
https://www.sharesmagazine.co.uk/article/7-unloved-stocks-can-they-bounce-back

This is the sinister side but it is illegal and not representative of 'everyday' shorting:
A Bear Raid - Illegal co-ordinated shorting with aim to drive share prices down
https://www.investopedia.com/terms/b/bearraid.asp

Bear Raid Definition and Example:
http://www.mysmp.com/stocks/bear-raid.html

Alfacomp - you stated yesterday it was an open secret in the industry about what was happening re: the share manipulation - are you able to expand on this?

Lower vanadium prices must have been partly responsible for our share price decline to the end of April. There was even speculation/concern yesterday that the lower we went the more vulnerable we might be to a low ball takeover. Seems to me this has actually payed to our advantage as the lower V price might just have made our Vanchem acquisition somewhat cheaper than say a few months ago. Seems every cloud has a silver (or vanadium) lining.

Hmmn, Long ago, BOOM was my "Punt of The Week" and hey, over 4 years later we're still inseparable - well, at least till I've broken even. Suspect, this could be the turning point though.

Regarding takeover it's clear from earlier posts we've all got our price, but it's assumed it will come from a hostile takeover bid (90%) which I believe is not how it will happen.. Many takeovers are conducted on AIM especially via Scheme of Arrangement. Google this and you'll find out how it works. Essentially, it's non-hostile and is 'arranged' in advance with the agreement of the takeover (Target) BOD. There are those that say this is Fortune's baby and he wants to see it through to the end but if there's huge money interests involved it won't be down to Fortune overriding his pet project. Indeed, it would most likely be 'arranged' in such a way as to hugely benefit key members of the board. The key difference in voting is that it requires 75% of the voters (but not including those held by the acquiring company). Key, 75% of those voting so it's critical that peeps vote and that does not happen here (I can supply an example later if required).
So, in the name of research Google along lines of: Scheme of Arrangement AIM Takeovers. Be warned it gets very complicated especially regarding country of registration (Guernsey) and operation and Directors residence, overseas shareholders etc. etc. But, that's why top lawyers in M&A are required. Here's a couple as an illustration but best for weekend reading and research.
https://www.slaughterandmay.com/media/39320/a-guide-to-takeovers-in-the-united-kingdom.pdf
and
https://uk.practicallaw.thomsonreuters.com/3-505-8683?transitionType=Default&contextData=(sc.Default)&firstPage=true&comp=pluk&bhcp=1

Incidentally, some on here I believe held shares in Marianna (MARL) which was taken out by this method so you may have some personal view. The former CEO of MARL - (Parsons) now on board of upcoming tin miner Afritin!
This BB is brilliantly researched on the technology, chemistry and general company strategies for the future but I've always felt we would benefit from some input from those that understand takeover law as it is undeniably a looming threat / opportunity (delete as appropriate).

Can't get involved in discussion as daughter just showed up from Uni on surprise visit means lunch, drinks and shopping.
(don't post often but thoughts with all those on this BB and their loved ones battling illnesses and recovering from treatments)

Daisan and SquirtyFlower, thanks for answering my question. Appreciated.

Regarding ISA limits. If someone was fortunate enough to receive dividends of let's say £16,000 in a year inside the ISA wrapper could they still invest £20,000 to the ISA (current year maximum) or, would it be limited to £4,000, i.e. Max ISA contribution less total dividends received?
Anyone know? Cheers.

I've started some basic research into joint stock exchange listings and can't find much in its favour other than the 'party line' that it opens us up to wider investor market and / or gives currency restricted South Africans a chance to invest in their own country. Fair enough but I also found some stuff on why dual listings are not achieving what was stated or intended. Research continues but all this got me thinking:

Someone on the BB recently feared a takeover of BMN at a figure well below what we might eventually achieve. I started musing (an old Corbine pastime) - what if BMN proceed with the joint listing and then at later date when BE is better established, floated it separately as per Afritin but on the SA JSE NOT on the London exchange. To me that would be a bummer if the big prize was deftly floated off before it reached anywhere close to full potential. Hopefully, won't happen or share price significantly higher before such an event.

PB940 Post 14:41
towards the end of the post, SA's Mineral Resources Minister, Gwede Mantashe addresses past wrongs to local black communities through apartheid and how they can be redressed:
“Communities are not going to wait for dividends, they want development in their communities,” Mantashe said.

Interesting. I suspect it's this mindset that's partly fuelling the industrial action at Vametco; to us affluent westerners dividends are relative icing on the cake but harder to sell to a long deprived community for whom dividends (and/or share option schemes) are probably too sophisticated and too long term. It's key that our negotiators understand this if they're to win the respect and cooperation of the strikers.

I dislike the principle of short-selling and consequently I've never even understood how to go about taking a position. However, if I was au fait with shorting and I'd been aware of the Vametco production shutdown prior to or from 5th Sept it would have been very tempting to take a position!

Ouch! South Africa reality check

Hi Ludeck (at 13:19pm), in my view Sojitz would wait for the Mokopane mining licence because it brings certainty (removes risk) that the site can be developed. Without the licence Sojitz's interests would be better served at 15% owners of Vametco ( cash flow certainty) rather than a more general BMN shareholding without Mokopane. Besides, Sojitz are multi-billion dollar organisation and no doubt follow strict guidelines when making their investments. All IMO.

Someone asked yesterday if the currently lower share price might hinder / benefit a Sojitz buyout. Certainly, any agreed purchase price will be based on revenue and profits not on share price; so the somewhat disappointing RNS about production (hence profit) might have reduced the price we pay Sojitz. However, once a price is agreed say £36.5m (oi, no heckling, just a number for sake of illustration) the majority would be paid by issuing shares based probably on an average price prior to agreement. So, if £6.5m was paid in cash that would leave £30m to come from issuing new shares in BMN (they're permitted to up to circa 350m). £30m at 28p per share is 107m shares whereas at 21p per share it's 143m shares. For Sojitz that would mean a larger percentage of BMN for us PIs it means significantly greater dilution. Move the share price higher / lower than 28p / 21p for even wilder results. FWIW I wouldn't be surprised if a draft contract is already in place, signing subject to the Mokopane lining license being granted.

Regardless of where the share price ends up at close today the RNS serves as a reality check to all of us; less than expected ore grades / unexpected workforce and local community unrest - this is the reality of running a mine and processing plant and it reminds me that it's dangerous to listen only to an unconditionally positive take.

Anyway, still a long and strong holder but couldn't help noticing no mention of the strategic buy out of Sojitz' Vametco holding; I still feel it's related to the granting of the mining license at Mokopane. Any thoughts?

Very solid and reassuring RNS. Regarding the Sojitz buy out speculation, which understandably is rooted in the phrase: "....to improve Bushveld's exposure to the underlying cash flows of its assets (US$9.0m) (£6.4 million)"; [from the March '18 placing RNS and repeated at the very end of today's RNS]. This wording has been removed in Fortune's CEO Report today under the heading: "Bushveld Minerals' Post Year End Events" - here, the purpose of the placing is stated as "simplifying Bushveld's organisational and corporate structure;" .

To be fair, it is an abbreviated summary of March's stated reasons but it (knowingly?) avoids reference to gaining 'exposure to underlying cash flows'!

Don't think there's anything odd here but it certainly steers the reader away from Sojitz speculation. I stick with my post from 6 June: Sojitz buy-out / Sojitz taking shares in the greater BMN is dependant on Mokopane mining licence / mining charter.

Maybe Sojitz could qualify as the 'strategic partner' that Fortune is seeking in his 'Mokopane Vanadium Project' section!

"The story of Bushveld Minerals is not yet half told" FM (today's RNS).

Onwards and upwards

Great earlier posts BBN re Eskom. BMN's acquisition of Sojitz' share in Vametco remains speculative. I remember some posters take the view Sojitz will sell and will be paid partly in cash but also in BMN shares - in others words, they'll be part of the larger BMN picture of Mokopane/BE VFRBs et al. Since no progress has been announced I suspect Sojitz might be holding back until either or both Mokopane mining licence is announced and or significant progress with VRFB demo is made. For Sojitz it would make sense to have these two key milestones de-risked. Any thoughts?

WorldGoRound, not sure whether you're peeed off at management/shareprice or enjoying the spoils of your investment but feeling guilty that WTB is bringing our beloved Blighty to its knees. Whatever, highly entertaining and the markets loved it - WTB put on over a quid in response to your post. I reread your prose in the voice of John Cooper Clark and it's even better - more please!

Excellent post ChesireKat, considered, probably accurate and non-hysterical. Please keep posting.

Oh dear. If only Boom were turning a profit there might be the chance of a takeover offer coming in whilst share is suspended. Any chance of this happening? Rather that than coasting along with RP at the wheel.