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It is highly unlikely that the bond tranche will be offered to PIs. It will need big instututional bond funds to hoover it up and importantly "manage them properly"... can you imagine PIs with bond trading...
My banker mate says the appetite for high yield is massive (look at the 10 year gilt yields). Pensioners need income, and we are all getting older.
In addition, for what it's worth, Fraser reckons it will be fully taken up. I for one, do believe him. The evidence is overwhelming, the hunt for yield goes on.
Yes, it is almost certain that Capital and Jupiter were made aware of the situation long before. Either directly or indirectly. Jupiter looks to have reinvested proceeds according to my banker mate -most notably to top up positions in the UK Growth funds. This is the city insiders tapping each other on the back. In Gordon Gekko's famous words... "If you're not inside, you're outside".
For those saying 5 years is too long, I strongly advise against investing in equity, unless it is for the highest quality blue chips. Put your hard earned money into some funds and gilts and go sit by the sea.
Sorry part 2 trimmed= CB holders will be able to sell above 15p. That would also bring the max shareprice down to 22.5p. Unfortunately, due to the structuring of this deal the upside has basically been removed until such time that over 4bn of shares have longer term holders. I'll be keeping a close eye on large investors coming aboard, but until they get closer to getting rid of all the shares that are coming to market the upside just isn't there. It's very frustrating. I think the possibility is definitely there for a prolonged stint below 15p.
Part 2 Search Stock Logged out default avatar Login Register Monitor Quote Charts Trades News Financials Toplists Alerts Portfolio Level 2 Free BB PBB ADVFN Logo Copyright © 2019 ADVFN plc Switch to Desktop View Sirius Minerals Share Chat - SXX Current Price 16.77p -0.23p -1.35% Bid Price Offer Price 16.73p 16.78p High Price Low Price Open Price 17.15p 16.31p 17.00p Shares Traded Last Trade Market Cap (m) 30,186,196 10:58:22 804.47 Sirius Minerals Share Discussion Threads Next Page Date Subject 02/5/2019 11:08 johnwise: Video: Gina Rinehart Australia's richest woman invests £245m in UK's Polyhalite mine http://tinyurl.com/yd3bqvcv Video: Gina Rinehart's Roy Hill Iron Ore Mine http://tinyurl.com/y7et4v55 Read Full ThreadFollowReply 02/5/2019 11:03 johnwise: Uncontrolled immigration.. It has been a deliberate act of destruction and its only ukip that have exposed them,i hope they are all proud of their mess Read Full ThreadFollowReply 02/5/2019 10:47 jw30: Thanks ppvn. As expected JPM exists to make as much money as possible for itself and not to make shareholders rich. Read Full ThreadFollowReply 02/5/2019 10:46 deanroberthunt: £15-20bn mcap at full production, with a 5-6% dividend Read Full ThreadFollowReply 02/5/2019 10:45 johnwise: Via.. jlondon "It is assumed that all FT100 co*s at their early stages carried various gradation of risks. Hence, why the FT mentioned that SXX is currently capped at £800m. So, if the potential is realised, the upside is a 15 bagger ie 16p+ x 15 times += £2.40. That itself tells that it is a process of de-risking". Building Woodsmith Mine: Shaft Boring Roadheader Video https://www.youtube.com/watch?v=3cWOB4qRQQg Read Full ThreadFollowReply 02/5/2019 10:43 deanroberthunt: It 3 bagged from the last big dilution...people have short memories Read Full ThreadFollowReply 02/5/2019 10:40 ppvn: GM Mr Oz / all, Ok well I've gone through the prospectus and all the other gumph with a bit of a tooth comb, but I have skimmed large sections as it's rather dull and I've focused on what I believe to have been the most important parts. I will say now that with a somewhat heavy heart I have disposed of my shares at a slight loss which is frustrating, so bear this in mind when reading. For me, the risk vs. reward has now been clipped to an extent where I no longer feel comfortable holding, but I sincerely wish all the best to those who do. I have no position long or short so I have tried to keep this balanced. It's a bit of an essay so I'll try and break this into sections as best I can. 1. The convertible loan tranche A) $400mm of CBs make up the "Escrow New CBs". This tranche, whilst cash is given to Sirius, is not actually released to them until September 2019, but this is contingent on them securing $500mm in debt by that time. Assuming the $500mm debt is raised by September, the $2.5bn revolver and CB funds w
Probably the most informed poster after Myo / GK on ADVFN: ppvn: GM Mr Oz / all, Ok well I've gone through the prospectus and all the other gumph with a bit of a tooth comb, but I have skimmed large sections as it's rather dull and I've focused on what I believe to have been the most important parts. I will say now that with a somewhat heavy heart I have disposed of my shares at a slight loss which is frustrating, so bear this in mind when reading. For me, the risk vs. reward has now been clipped to an extent where I no longer feel comfortable holding, but I sincerely wish all the best to those who do. I have no position long or short so I have tried to keep this balanced. It's a bit of an essay so I'll try and break this into sections as best I can. 1. The convertible loan tranche A) $400mm of CBs make up the "Escrow New CBs". This tranche, whilst cash is given to Sirius, is not actually released to them until September 2019, but this is contingent on them securing $500mm in debt by that time. Assuming the $500mm debt is raised by September, the $2.5bn revolver and CB funds will become available to Sirius. B) $106.6mm of new CBs will be issued to holders of the existing CBs. No cash is raised by Sirius since they got this cash in stage 1; it's an exchange. C) $137.6mm of existing CB holders haven't agreed to exchange their old CBs for new CBs. I assume these will be converted into equity and some short positions will be closed from this amount. Equivalent to 447mm shares. 2. The firm placing and placing A) 2.18bn shares will be issued in this piece at 15p. The issues I had is is that the $2.5bn revolver isn't really a $2.5bn revolver. For each $500mm drawn down, Sirius must issue further debt in order to avoid incurring a penalty interest rate that kicks in 90 days after they breach the $500m limit. Should they fail to issue new bonds and go over $1bn drawn, JPM will conduct liquidity tests to see if further monies can be paid. If they issue the $500mm in increments and repay the revolver, the total reduces by 60% of the amount repaid - so basically after they repay say 500mm of 2.5bn it then goes down to a $2.2bn facility etc. Once they've issued and repaid the full $2.5bn facility they'll have a $1bn facility which kind of makes sense. By that point the mine should be built. The caveat in the prospectus though states that if they can't raise debt to repay, they can issue further CBs, equity, mezzanine debt, preferred equity etc. So to the CBs. Conversion price is $0.2443 or 18.75p. The issue here for me is that 2.18bn shares from the 15p placing have to find homes before that level will be seen. Sirius are able to call the bonds after June 2021 at 150%, or 28.125p. So that is the top share price that can be expected until the CB tranche (2.1bn shares) have found homes. The other issue is that by 20th May 2020, the CBs can be repriced to adjust the conversion price down to $0.1954 - 15p. So if certain conditions aren't met, CB hol
Myo, paaa and GK were the 3 best posters for level headed information. Where is Paaa btw... Myo was the most pleasant. LL occasionally says something useful and has a keen eye, but is incredibly cynical. Other noteworthy chaps/chapettes = Sheps8, Chesh, Verde, Stanley -all people who have contributed massively. Funny that Alan G has gone quiet too... And casa, whilst arrogant, has often contributed some good stuff.
LL
Yes, can you tell us about Myo's "drivel"?
Highbridge capital, one of the biggest shorters of SXX... are owned by JPM...
Where are all the hard hitters? PAAA, Myo, GK... Three wise men (or women).
Thanks LL. Good times!
With that dilution (10bn shares??) If I can make £1 a share in 10 years time I will be happy.
Poortiming: Aye. Bonds which don't convert, or do anything fancy, are known as "plain vanilla" in the industry. As far as I read, we have done the following: 1. Raise equity 2. Issue convertible bonds (a switch for current converts) We will be... 3. issuing senior secured debt (plain vanilla) 4. Then getting access to JPM's credit facility
Look at it this way, which is what my banker mate told me: Do they need that tranche of cash today? No. We have the cash from the equity raise. So why pay high interest for cash sitting in the bank for 6 months.
Do you mean plain vanilla bonds? Those types of bonds don't convert.
Yes that's right, dollars. But sterling could be anywhere in 10 years time, who the hell knows...
Fraser said they had already spoken to high yield fund managers and was therefore sure of uptake. People are yield hungry due to low rates, expect full take up.
The net present value (depending on poly price and various factors going smoothly) is quoted around $15-30bn... so lets say $20bn at full production. Simply divide the NPV by number of shares. $20bn / 10bn shares = £2 per share. Again, that is at full production with all things equal (construction on time, on budget, minimal product disruption, minimal competitor disruption etc).
Some of you are nuts.
Fraser has said for years that one of the biggest problems with the shares is the PI exposure.
Hopefully this colossal tree shake gets rid of most of them. The jack of all traders, the snake oil rampers, the murky derampers and all inbetween.
Onwards and upwards. Buy and hold.
So many people appearing feeling sorry for us LTHS. Whoever thought this was a simple project and a get rich quick scheme were blinded by greed. This is a 5 to 10 year holding period. If construction goes to plan with the odd wobble, you will see multiple x your return today. The BoD are not the best, and one day they may go, but the mine will remain. And maybe, we will be bought out by BHP or Rios... the structural drivers of population growth and food production issues are massive (look how many old fogies are on here, and note that half the world is starving). End of the day, if it goes belly up, I will still have my house and life savings. Good luck and don't listen to anyone. Stick to your life plan.