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I would like to see a timeline that sees a deal done in this tax year. My belief is that there will be profit in it, not as much as getting a mine up a running, but there will be some. And I would like to see any CT paid at 19% and not 25%. Perhaps there will even be time to pay a dividend this tax year if the process moves fast enough (not every Condor share I have is in an ISA). My sense is that if it's not done by March 31st this thing could stretch out into the summer without a timeline. Like everyone else, now the die is cast on the 'not building a mine' scenario I would like my money out and in to something else.

$100 to $200m might be the ball, but I think there will be a lot of questions if the deals doesn't reach $150m.

Meanwhile, although the current SP is pretty irrelevant at the moment, people are still selling. Then again perhaps a couple of pence is worth having if you can't wait.

Any party wanting to buy Condor in the open market would find acquiring even a single digit % likely to push the SP up way beyond 50p. It's just too illiquid. The cat would soon be out of the bag.

All being well this time next week we'll have a progress update. Assuming the bid process had been well defined before last year's beauty parade announcement, a couple of months to get the initial round done and dusted seems reasonable. If something is not out by the 3rd I reckon a few question to the company are in order.

Oh no. Not the fruit and veg again…..

One of the reasons I think the per share value will be higher is because a part paper sale would facilitate a higher price. I know it will be optics vs. hard cash but I've seen it happen in other situations. The acquirer buys with its own paper which at the time is carry a good market price. It potentially makes a deal look better than it actually is.

I don't know what the intra - company debt will be yet so the £45m is a guess. One way or another it will need to be settled (Condor Gold paid off). I reckon the Nic companies will be sold rather than the individual assets within them. After all they will probably be carrying some (useful) cumulative losses for offset against profits (I don't know Nic's CT system but I assume there will be offset rules in place). Thus, if the companies are sold in their entirety I don't think Condor would would to be owed £45m ongoing. Debt settlement would probably be part of the exit deal.

I'm fully aware that I could be way out on this. I'm just thinking through some of the nuances of a possible deal and how the money might flow back to Condor. Also, don't be surprised if there is some sort of deal completion bonus issued to insiders who couldn't exercise options/warrants. I've seen that before as well.

I don't see a lot of point tub thumping about what might have been, or moaning about the SP. We are where we are. Condor has never received anywhere near its asset value so why should now be any different? While production still remains a (remote) possibility the more likely outcome is some sort of exit. That's what I'm interested in reading about, and what I think about.

Yes, I'm still in the 60 -65p, as expressed in SP terms, but I'm just as interested in how we exit as much as how much we exit for.

At the moment I'm thinking that the c.£45m intra - company debt will be settled in cash but that the rest of the consideration will end up being in the form of an equity swap with a current producer. Some of the £45m would be retained to administrate for a period (say £2 - £3m) with the rest being distributed via a special dividend. The residual value of Condor would then be roughly valued on the basis of its new investment in a producing miner, probably a dividend payer. The question then becomes one of what to do with it. I suspect a lockdown for a time; Condor perhaps being contracted not to sell for a time, and then maybe by tranches.

That's just one scenario. What about other posters throwing other ones on the table?

I tend to keep an eye on the USD, particularly the DXY.

https://www.marketwatch.com/investing/index/DXY

From around November 22nd it has slipped from around 112 to 101 as I type. meanwhile gold has risen. Expectations of a more 'dovish' FED on interest rates have encouraged USD decline at the same time as giving a lift to gold. Gold doesn't always move inverse to the USD but there are periods when it does. Technicians reckon the USD is oversold at the moment so a bounce up in the DXY might be on the cards; likewise a drop in gold. If it (USD) is bought I doubt it will last, especially while another debt ceiling pantomime is also on the cards. I'm also of the view that the whole world is not long off waking up to the fact that US debt is heading for $32 trillion and growing at a trillion a year. The US will never default but the value of its currency will have to drop.

https://www.usdebtclock.org/

Timing wise gold at $1900 can't be bad given the negotiation situation.

I'm hoping we will see something next week. Agreed that enough time has passed for some sort of interim progress report, even if it's to say we are behind the original schedule; whatever that is.

As for the SP, I'm not expecting much movement until some sort of news is forthcoming. No news is often interpreted as bad news by the market and it's not as if the company is willing, or able, to talk to investors, prospective or otherwise. To be honest I was surprised at how forthcoming the last interview was. That $100 to $200m estimate did get my attention.

I've mentioned before that there are so many variables at play at the moment that it's impossible to be certain about how things will play out. Take the options and warrants. It's not difficult to see a situation where none will be exercised. At the moment the insiders are not able to because of proximity to price sensitive information but after the sale news is in public domain it could be game on, subject to the rules associated with each tranche of options or warrants.

What could happen on day one of the news? Price volatility for sure, and probably an immediate spike, but then what? Will (eligible) option\warrant holders have time to exercise before the price dips? I'm pretty sure that there will be a lot of selling on day one as investors keen on taking gains vs. dividends will bail out. This would likely suppress the SP, capping the spike and probably reducing the SP pretty quickly. Suppose holders of 5m or 10m options are eligible to exercise? Will they also sell for an instant capital gain, or wait for a special dividend? What happens if they do sell and 5m - 10m shares hit the market? Will new shares flood the market and suppress the SP? Will we see a lot of new investors jump in for a 2023 dividend payout? It's impossible to guess what might happen but an instant spike to 35p or 40p could be followed with a sharp drop.

Then there is the possibility of a paper and cash exchange. The deal could end up being circa £45m is cash to pay off the loans and the rest as equity in the acquiring concern. Condor then effectively becomes and investment company; the interests in its own subsidiaries being exchanged for an interest in the acquiring entity. If that entity is listed a valuation of that interest would be easier to reflect in Condor's valuation. Thee would then be a decision of what to do with the paper. Sell it (probably subject to deal constraints) or sit on it for a time. Only the loan repayment would then be available for cash distribution. Perhaps this would be an early return of 20 - 25p\share.

As I've repeatedly mentioned it's diabolical trying to work out how things might unfold.

I'm not buying more. I keeping two portfolios, one speculative and the other conservative. Condor is already disproportionate to the others on the speculative end and I've learned the lesson of Arian Silver. No matter how good it looks or how close you are to getting a return you need to manage risk. I'll switch a few around in March\April but I don't really want to take on much more. I'll be realising some gains on other shares in March and may pick up a few then if the price remains low but it will low numbers at best. I wouldn't recommend anyone get too deep. My strong buy is really for new investors coming on board.

I ran out of characters. The last point I was going to make was that the assumptions I've made could go either way but I doubt that all will be negative to my base case, nor will they be all positive.

There doesn't seem to be much we can do at the moment other than wait and see what happens. I'm hoping the next update will be no later than the end of week 1 February.

Assets discussion.

The last financials have a balance sheet date of December 31st 2021 so the numbers will most certainly have changed by now, albeit my guess is that the basic structure remains the same. Condor Gold is a group holding company so you could define its assets as its subsidiary interests, as much as 'real' assets, the land and gold in the ground. A consolidated balance sheet is presented which aggregates the assets although I'm inferring from the fact that within note 2, 'Assets 2021', that the actual land and resources are held within the holding company's subsidiaries - 'The group had intercompany debt owed to the UK at 31 December 2021 split segmentally as follows: Due from Nicaragua £39,511,480'. My guess is that this is now more in the region of £45m given subsequent payments on the mill and land.

Note 11 provides details on the subsidiary investments, all 3 incorporated in Nicaragua
Condor S.A.
La India Gold S.A.
La India Inversiones S.A.

Condor (holding co) set these up for tax/political/regulatory reasons at some point in the past when I wasn't paying much attention. The holding company makes a loss and funnels cash raised into these (pre-operating) companies to acquire assets, hence the £39m/£45m amount due from them.

My guess is that it's these subsidiaries that will be sold rather than a contract for selling the actual land, licences and mill. It's cleaner and Condor holdings won't have much use for them in the future. To any employees and change of owner is just that; business will continue as usual.

Assuming the assets are sold my guess is that the first element of cash repatriation will be settlement of the cumulative intra-company debts i.e. the £39m/£45m. The buyer injects the settlement cash into the Nic companies who in turn repay Condor (holding co). The rest of the consideration is then subject to a capital gain on the difference between the subsidiaries balance sheet investment cost and the rest of sale proceeds. So, if £150m is raised, £45m is paid to settle the debt and £105m is then the sale proceeds for disposal of the companies themselves. The £105m is then the UK capital gain and (ultimately) subject to corporation tax. Which is why a March sale would be better than a June sale (19% vs 25%). Condor had £25m of cumulative losses in the consolidated balance sheet but I don't know how much of this sits in the holding company vs. the subsidiaries so you can't be sure how much the taxable gain would be offset by cumulative losses. Given the numbers I'm fairly sure something will be payable and probably noticeable.

There are so many variables flying around that it's impossible to come up with a definitive scenario given the limited data in the public domain and the, as yet unknown, sale price. I've made a whole bunch of assumptions and could be out on several. Nonetheless, however I play around with the upsides and downsides a 60p valuation per share still looks attainable.

I did play about with the per oz valuations. The good news is that these averages were based on a time where gold was lower. For once fate is playing into Condor’s hands in that it looks like $2000 may be on the cards this year which could push reserve/resource prices up. At the moment I would be more inclined to be more optimistic.

I’m going to take another look at last year”s balance sheet and take a stab at how any cash will end up in the holding company.

I agree on the options. I doubt all will get exercised, either due to expiry, unwillingness or simply that the SP will not reach the strike level. I’m sitting around 60p for a valuation level but I doubt the SP will get beyond 40p due to the legacy unwillingness for the market to give full value and the likelihood of selling activity on the way up. Any options or warrants above this level would not get exercised.

From a timeline perspective I reckon they want a quick sale. With corporate taxes on the increase I suspect that a target sale would be by the end of March, although processes like this rarely go exactly to plan. If it doesn’t go by then I would imagine June or July would be more likely, the early exit heat being off.

I somewhat surprised at the number of investors walking past this given the early gains on offer. A fairly instant doubling in share price could be on offer on news, albeit a lot of volatility on the way up.

Open pit BFS only:

Indicated 827000 x 100 = $107,510,000 ($160 reduced to $130)
Inferred 69000 x 20 = $ 1,380,000 ($20 standard average)
Total 896000 $108,890,000

Convert @ 1.22 £89,254,098
Cash raised £16,744,748 (options\warrants if full dilution)
Land & SAG mill £10,000,000
Total £115 998 847
Full dilution 239,779,657
Per share value 48.4p

Upsides - add in some value for all the other gold resources:

Hi grade
Indicated 1088000 x 30 $32,640,000
Inferred 1190000 x 20 $23,800,000
U/G
Indicated 194000 x 30 $5,820,000
Inferred 898000 x 20 $17,960,000

Total $80,220,000
Convert @ 1.22 £65,754,098
per share value 27.4p

Total 75.8p, say 76p (ignore the 84p suggested earlier; I was using $160 top end vs. $130).

So, my range is 48p to 76p but I fully acknowledge that you can up the numbers give gold's bull run at the moment and that you can add in something for intangibles such as good relations with the locals and politicians and future potential. On a really optimistic scenario you could at a stretch make a case for 100p, albeit I reckon it's as unlikely as 40p at the other end.

My actual expectation is still sitting around 60p, although hopeful of a bit more.

Feel free to kick it around. The chances of me being bang on are remote. I just hope I'm in the right ball park.

Rest to follow. I caught a bloody key while writing.....

Updated for the results of the open offer. Expressed in a per share terms I reckon on somewhere between 48p and 84p, depending on what valuations you put on reserves\resources.

Looking at the dilution question first.

Options - officers
1,850,000 x 0.22 £407,000
3,375,000 x 0.42 £1,417,500
2,650,000 x 0.48 £1,272,000
3,900,000 x 0.285 £1,111,500
11,775,000 £4,208,000

Options - non - officers
4,284,000 0.42 £1,799,280 (guessed average as the strike prices unknown)

16,059,000 (options)

Warrants
8,194,125 x 0.4 £3,277,650
5,857,138 x 0.5 £2,928,569
5,803,570 x 0.35 £2,031,250
16,666,666 x 0.15 £2,500,000
36,521,499 £10,737,468

Total 52,580,499 raising £16,744,748 (depending on non-offer strike price assumption)

For full dilution add
In issue 180,532,491
Options 16,059,000
Warrants 36,521,499
Loan note conversion 6,666,667
Fully diluted 239,779,657

I doubt everything will get exercised so 240m is top end.

Open pit BFS only:
Indicated 827000 x 160 $132,320,000
Inferred 69000 x 20 $ 1,380,000
Total

Gold has bounced up from around $1740 in November to over $1900 as I write. Given that many observers are talking it up to $2000 or more this year its recent performance may well flush our another bidder or two. Whether it goes up a lot more at this time seems to depend on how U.S. CPI performs. If it looks like it's about to drop further, the logic is that the FED will not increase interest rates at the same rate, which in turn will put a bid under gold.

Crypto also remains precarious. Too many have lost too much money on it for the space to become flavour of the month very quickly. After peaking back in 2012 it took gold until 2018 - 2019 for it to show signs of life again. It would not surprise me for the crypto space to spends five or six years treading water, or even dropping, before a new generation gets interested. This should also help gold over the next year or two.

Longer term (perhaps not) markets will wake up to U.S. debt levels. That's when the real fun with gold will start. But watch out for taxes when that happens. You might own it but the money grabbers will want a giant slice of any gains.

It's a strong buy, but don't forget that once we pass 22p some of the options are above water. The insider trader rules could be a problem for a few people holding them given the proximity to knowledge of the bid process. Nonetheless, there still may be some.

After a deal is announced I've no doubt we'll see a significant jump in market valuation. The info will be out so the options\warrants people will be looking for opportunities to realise a quick profit. This will hold back the SP, which in turn will prevent the higher strike price tranches from being reached. It's impossible to guess where a post sale SP will reach but I highly doubt it will get too close to the sale proceeds as expressed in SP terms. My guess is that if the value in SP terms is, say 65p, the SP will struggle to get above 40p. Those (substantial) options and warrants above that level will equate to dilution. It would not surprise me to see the SP undertake all sorts of somersaults in the 35p - 55p range as the market digests the impact of potential dilution vs. the prospect of a robust payday at the end of it. Of course I could be completely wrong, and the market gives the SP full value based on a fully dilutes equity base (i.e. doesn't care about another 40 - 50m dilution).

Quite honestly, although I would like to realise some capital gains from the asset sale the SP languishing around 20p until the deal is announced also works for me, especially if its not announced until spring. Increases in the SP at this stage may only invite the prospect of more option related dilution (subject to insider trader rules) and plays into the hands of day traders. Today's SP is pretty academic at this stage.

I'm guessing that the next update will be around the end of the month. To all intents and purposes this has been the first week back. Bidders will be getting their ducks in a row during this period. The timeline for the process is not clear to me but I would imagine that the end of January would be a good target date for bid submissions. Perhaps we'll see an update soon afterwards given the obvious price sensitivity of the news. That's what I'm expecting but in the absence of a published timetable it could be a little bit earlier.

I've designed and administered bid processes in the past. If I were doing this one I would go for an end Jan for the initial round and end Feb for a BAFO (best and final offer) from the shortlist. On that basis a deal could be announced during March, depending on whether there is some additional scope to negotiate with the round winner (they are rarely 'clean' win\lose). In CNR's shoes I would want contracts signed in this tax year but bid processes rarely go exactly to plan - probably why a specific timetable has not been released.

Bear in mind this is a sale of assets rather than the sale of Condor Gold itself so the administration of the bid process will be less regulation rule based.

I'm out as of this morning so I'll make this my final post on the DLG board.

To those who think it will bounce back this year, please bear in mind the economy. Recessionary times don't usually do any type of financial much good and we are on the brink of one, deep or otherwise. It bounced a little today but whether that is a dead cat or otherwise remains to be seen; tomorrow's opening will provide a clue.

I stuck with it (underwater) for a couple of years, expecting some improvement but reconciling myself to the fact that divis would be still be paid. How wrong I was. As they say, hope is not a strategy. I'm dubious about any early recovery. 2023 looks like a write-off so you have to look at 2024. It might get better but based on all the other companies I've seen who stop paying divis, when they do come back they come back far lower than prior to stopping. My guess is that it will be several years before better times and perhaps even 12 - 18 months before the 25% drop is restored. If the price holds up the rest of the week I reckon it will tread water at these levels well into 2023 and potentially beyond.

And we've yet to see if the small bounce at towards the end of today is a dead cat.

Good luck to anyone having a go a capital appreciation. I think it will be needed.

Over and out.

For the record I've just bailed on Aviva as well. This part of the sector is looking wobbly.