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It will be interesting to learn of the beneficial owners of Ying He Yuan Investment (S) Pte Ltd and Summer Trees Pte Ltd. Both are holding companies incorporated in Singapore. If they are acting in concert with Mr(s) Zhen, then minority shareholders might be disadvantaged.
Really between a rock and a hard place. If we vote For, a party might have de facto control of the board. Whilst the Zhen's funding proposal is 30% less than the VWAP, it is a loan instrument which potentially means minority shareholders do not get diluted further. Although we do need to balance this the terms of the conversion.
If we vote against, the existing board stays. Their track records has been dismal. Share price has been falling. Shareholders will continue to be further diluted with Senosi Group.
The interim CEO mentioned "an out-of-date Makhado feasibility study was proving to impede capital raising efforts." Whilst I cannot fault him, Bernard Pryor has been overseeing this for years.
Hypothetically, what if I Bernard Pryor gets voted out but Sam gets to stay together with Nhlanhla and Godfrey coming onboard? Could this be possible?
https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02482002-6A1075246?access_token=83ff96335c2d45a094df02a206a39ff4
Hopefully this will be the start of positive developments for the company. Unlike Makhado hard coking project is up and running, minority shareholders will have to brace ourselves for more dilution though.
Headwinds are getting stronger. Does not appear that Haohua Energy will the white knight that we are all hoping for.
https://www.miningmx.com/top-story/48162-chinas-sa-ambassador-confirms-no-investment-in-limpopo-coal-project/
"The 208,537 shares have been issued to Mr Brown in lieu of his six-month notice period following his resignation as CEO and Executive Director." - It makes no sense to me that the company has to compensate an employee for his termination. In fact, if the employee doesn't serve his notice period, he would have to compensate the company.
Seems to me that Brown was asked to resign. And if this hypothesis is correct, then something is brewing in the background. Maybe the company is in play. As the Chinese proverb goes, one mountain cannot contain two tigers.
Usually when it is credit negative when a company does not have a succession plan when its C-suite resigns but in this instance, I welcome this development. Like John Wallington, David Brown failed to increase shareholder's returns.
Hopefully the Board and major shareholders will put in place someone who could take the firm forward. GLA.
3 Key takeaways for me:
1. Available cash at Quarter-end of $3.5 million ($5.3 million at the end of September 2019) with restricted cash of $0.03 million.
2. MC Mining is progressing the remaining Phase 1 funding requirements and anticipates that these will be completed in H1 CY2020 with construction commencing in H2 CY2020.
3. The Company is in the process of various initiatives to raise the balance, including positive discussions with debt providers, current shareholders and potential new shareholders at both group and project level.
At the rate of the cash burn, the company might not be solvent if no additional funding is secured soon.
The company had previously indicated that financing will be at the project level. But the latest announcement suggest that funding will be at the group level too. That can only mean more dilution for minority investors.
Sadly, the latest results does not paint a rosy picture of the the company.
I thought it was odd that it was the CEO rather than Chairman that signed off the resignation announcement of a Non Executive Director. Hopefully the major shareholders will take this opportunity to remove dead wood and ensure a proper functioning Board of Directors.
Being taken out is the best chance for Minority Investors to recuperate our losses. But this isn't the opportune time for a sale. The company needs to be free cashflow positive first.
The urgent mandate is for Management to secure financing at the project level in order to maximise shareholder's returns. All eyes on the update towards the end of the month.
When David Brown was appointed as Chairman in August 2012, he said his key priority was to re-establish shareholder value. Progress has been painfully slow. M&G has probably written off this investment in their books, whilst the Chinese are in no rush to inject fresh capital into the firm. Liquidity is practically non-existence so minority investors will find it hard to divest.
Hopefully 2020 will be a catalyst for change with institutional investors taking a more proactive approach in holding Management accountable for their actions.
Good luck everyone.
I thought it was a little cheeky of the company to embed an update of Makhado funding in the Director retirement RNS on 03/12/19.
...Mr Cordin has been a member of MC Mining's board of directors since 1997 (22 years) and contributed to the Company being positioned to become South Africa's pre-eminent hard coking coal producer once the necessary funding is secured, anticipated in H1 CY2020...
The goal post is now a further 6 months away. Does management remuneration commensurate with their performance?
Really hoping for some positive news.
But given the headwinds and multiple false starts in the past, I remain sceptical.
I do hope the company will give us an update before AMSA's conditions precedent long stop date.