Member Info for ElectricLion

I don't know if it can be said that I am *supporting* HAA exactly, but I do think that this is a good time to hold or buy, and probably not a good time to sell. A raise has just been done and so another should not be needed for a while (if ever). There is cash in the bank. The SP is on the floor (can always go lower of course). TK must surely, surely be close. SA assets will be sold. Bittersweet for some, but we were out of our depth financially trying to keep up with the spend rate. That will give further cash in the bank, allowing for other opportunities and possibly (hopefully) meaning little or no future dilution (he says, keeping his fingers very firmly crossed).

All that said, I would not be suprised if TK finance is not completed in 2024. That conclusion simply comes from looking at the calendar and seeing that there is not much of 2024 left! I know Ethiopia works on a slightly different calender to us, but whichever way you slice it, there only another 2 weeks until Christmas, in most of the parts of the world that celebrate it.

If the Christmas and New Year celebrations are behind us and we still don't have TK, HAA is going to need to step up his game simply to convince many shareholders to keep giving him the benefit of the doubt.

I agree tomamara. Perhaps Ilka can clarify later, but it has the look of AI to me, and those things should not be taken at face value.

I'm not sure I understand Ilka. As far as I can see the production part of the CVR is based on first pour within 5 years, not on any production targets at all. Have I missed something?

Translation from Google to save everyone else the bother:

"Only resource-based payment has a high probability of success, while production-based payment is unlikely due to limited capacity and time constraints. The overall success of the CVR agreement therefore largely depends on the exploration results.

The question then arises as to how a reputable company can make such an offer knowing that part of it can never be achieved."

Where's that from Ilka?

"for a gold producer with a long mine life"

Indeed, this is the key I think. The La India mine will last longer than many of us (several million oz at 120k oz a year), so once it actually becomes MTL's property, I'd expect the market to pay a bit more notice to MTL's *current* cash flow, as well as future prospects.

Agreed cf. No way is the market going to value a company on a decent forward P/E ratio if the money-making machine is going to grind to a halt in a couple of years. That said, with La India up and running by then, the money-making can continue, and so once the market appreciates that, I'd expect a corresponding uplift in the MTL SP as a consequence. So I think the argument that MTL is under-valued *right now* is debatable, but it certainly will be once the acquisition goes through.

Don't take my word for it, DYOR as always, but that is my reading of the RNS, yes. The cash, MTL shares and CVRs appear to all be independant components of the deal. I can't see anything that says your CVRs are voided if you sell the MTL shares, but please check for yourself.

I doubt MC is answering any communications any more, but if anyone still has contact with him it would be good to get that confirmed.

It is too big to fail, IMHO anyway. And the comments are pretty tame compared to what was said a couple of years ago. It'll happen, but the waiting (and the dilution) is painful. All that said, if there's nothing in January, and the target becomes "Q1", you won't be the only one having a good think.

"If the deal doesn't go through because the shareholders don't want it, we'll be bankrupt"

And that's exactly why it will go through (IMHO). By the time of the vote, after emotions have cooled down, I can't see that there'll be enough shareholders willing to take that chance for it to fail. If it does, MTL will just tweak CVRs a bit and put it to another vote.

Yep, we're all waiting for finance! What's new! lol

I feel somewhat naive even thinking this, but I honestly think that there's a decent chance that we'll never need another raise. The finds from the last one should carry us through to the sale of the SA assets, which themselves could and should, if not squandered, carry us through to TK production. The only question is whether HAA decides to splash the cash about on something else, which no matter how good the opportunity seemed, I'd struggle to find any enthusiasm for if it increased the probability of yet more dilution.

If you'll forgive me, I'll quote my own post from the MTL board:

"The deal is cash + shares + CVRs. The CVRs appear to be a separate item, not linked to MTL shares. So one way to play it is to load up on CNR shares before the deal goes through. Even if you reduce your MTL holding afterwards, you'd still get to keep the CVRs. If you think the deal will go through, then it makes more sense to buy CNR shares than MTL ones right now."

I think there's a significant arbitrage opportunity right now. The CNR SP doesn't even reflect the value of the cash + MTL shares, to say nothing of the CVRs. Whatever your feelings on the deal itself, or your long-term intentions, I'd say selling up right now, at this price, is probably not the best move.

I'm not certain we will ever find out Seingred. Just as with other costs, it may end up buried in paperwork, so not easy to find. As we have discussed before, I am pretty convinced that the terms of MC's bonus did not kick in until 40p. HOWEVER, the CVRs may have been almost custom-designed to hit that target, even though that would be disengenuous at best. I also suspect that one way or another, JM will make sure that MC does OK out of it, all rules and regulations aside. So in other words, I expect MC to get some sort of payout, *even if* the terms of his bonus don't appear to us to be hit.

That is my understanding too. The deal is cash + shares + CVRs. The CVRs appear to be a separate item, not linked to MTL shares. So one way to play it is to load up on CNR shares before the deal goes through. Even if you reduce your MTL holding afterwards, you'd still get to keep the CVRs. If you think the deal will go through, then it makes more sense to buy CNR shares than MTL ones right now.

BMR - I'll give this one more go, before putting you on filter forever. You are going to need to let this go or it will destroy you. Everyone here can see you having an actual nervous breakdown, if not worse, in real-time. You don't know me, we'll never meet, but I wish no harm to anyone here. Please, for your own good, and that of those around you, get help. Start by simply not looking at this board until Monday. You need to get some perspective back, before it eats you alive.

I've had MTL on my watch-list for some time (along with a bunch of others), so I was aware of their existance. The London-listed junior resource sector is a pretty small world really.

The point as you correctly say is that by taking a companies paper in a deal, whether that be MTL or Calibre or whoever, is that you become, somewhat by default, a holder of their shares, when you may never have bought them independantly. Give me cash any day. Then I can choose where to put those funds, thank you very much. If the MTL investment case convinces me, then I could buy some on the open market. If not, there's plenty more fish in the sea.

One point that Seingred may not appreciate is that liquidity is an issue. It's not so easy to dispose of hundreds of thousands or millions of CNR shares on a whim, and I'm not certain that MTL is much more liquid either. That is one lesson for sure - don't over-invest in a low-liquidity equity, as it limits your maneuverability.

Quite apart from the deal price, there are a number of aspects of this deal that just don't feel good, and in any case, time continues to pass (which the deal, the CVRs in particular, utterly fails to respect), and my risk profile is changing as I get older. The times comes when you need to start prioritising holding onto what you've got rather than going for hail-mary passes in the hopes of making a fortune.

So with all that in mind, my thinking today (and it's changing rapidly as events swirl around us), is that I'll simply get out, not just of CNR/MTL, but of most of my current investments, certainly all the ones on AIM. For example, "Vanguard LifeStrategy 100% Equity A Acc" has returned 67.65% over 5 years, with, more to the point, a tiny fraction of the risk of any individual equity, or crypto coin, and maybe that's good enough.

I'm not an expert on MTL. Just quoting what was in the RNS.

My only real comment would be that you have to look ahead - it's gonna take ~18 months and ~$100m to build the La India mine. So you don't want to leave it until you only have a year or two left.

You're a bit of a one-trick pony aren't you pedro.

"I,personally would feel much more comfortable doing that..."

I think you may have mentioned this already! Regardless, neither your BoD nor ours are likely to walk away from a deal that they've already invested a considerable amount of time and effort into. The deal may get tweaked slightly, but I consider the chances of it not going ahead at all to be pretty low.

As for other, more local, opportunities, well it's probably best to let the RNS speak for itself:

"With MTL's Runruno mine nearing the end of its mine-life and the Abra Project still being early stage, Condor Gold's assets present a compelling opportunity to simultaneously acquire a well-explored and substantial gold project with a relatively near-term path to production, diversify geographically, and strategically expend the free cash flow its Runruno mine is generating to increase the potential for enhanced returns to shareholders."

When all's said and done, either you trust your board to do the right thing or you don't. You know what we think of our BoD! But yours seem to be held in some regard by shareholders, so maybe give them the benefit of the doubt that this deal is the best option (not the only, but the best) for MTL as well as CNR.

2 years after first pour (something of the order of 18 months following construction start, whenever that is, let's call it Spring 2025) and 5 years. Your words. You can't see why CNR shareholders might be unhappy with that? In the long run, we are all dead after all...

Naturally there will be differences of opinions between the 2 sides, but it is worth noting that the CVRs *have already been tweaked* (compare and contrast your RNSs on the 2nd and 4th). So there's already a precedant for tweaking them.