Member Info for extrader

د. ثاني أحمد الزيودي

@ThaniAlZeyoudi

·

Feb 9

The UAE and Congo-Brazzaville are forging a trade partnership rich in potential. In December, we finalized terms of a CEPA, which will build on the $10.9bn in non-oil bilateral trade recorded in the first 9 months of 2023 – an 83.1% increase on the same period in 2022

د. ثاني أحمد الزيودي

@ThaniAlZeyoudi

·

Feb 9

I was delighted to meet HE Jean-Baptiste Ondaye, Minister of Economy & Finance, today and begin plans for the CEPA's implementation. As their 8th-largest export market, we also discussed ways to leverage the UAE's role as a key global gateway for Congo-Brazaville's exporters.

HTH

Friday's depeches carries 2 x snippets of general interest :

(1) .."The CMA CGM SCANDOLA arrives in Pointe-Noire as the Group's first LNG-fuelled LNG-fuelled container ship to call in the Republic of Congo

The CMA CGM SCANDOLA is deployed on CMA CGM's West Africa Express service, directly linking West and Central Africa (Tema, Lekki, Abidjan, Pointe-Noire) to China, South-East Asia and India.

CMA CGM supports its customers and strengthens its services with high-capacity vessels.

CMA CGM's WAX service, WHOSE LAST PORT IN AFRICA IS POINTE-NOIRE , enables Central African exporters to reach Asia with competitive transit times, and is also a new vector for importers, complementing the Asia West Africa Service (ASAFGR), dedicated to imports and which continues to reach Pointe-Noire AS THE FIRST PORT IN AFRICA from Asia..."

PN's importance as a hub is growing, let's see what, if anything AD Ports does with its new Concession.

(2) Big Den is in Abu Dhabi atm to close that bilateral trade AND INVESTMENT [my caps] agreement.....

COOPERATION

Congo and the United Arab Emirates strengthen their economic partnership

The President of the Republic, Denis Sassou N'Guesso, has been in Abu Dhabi, in the United Arab Emirates, since 8 February, where he and his counterpart Mohammed ben Zayed Al Nahyane will preside over the signing ceremony of the

comprehensive economic partnership agreement between the two countries.

For the Emirates' Minister of State Minister for Foreign Trade, the agreement represents "a great investment opportunity for Congo, a country with a prosperous economy in Central Africa and a valuable trade and investment partner".

"The signing of this agreement builds on the dynamic economic ties between the two countries, supported by non-oil

trade, which doubled to more than two billion dollars in the first half of 2023", said Thani Ben Ahmed Zeyoudi in his X account...."

GLA and ATB

.."The Australians have little incentive to invest in new technology. After all there is not yet a much of a premium for DRI pellets and anyway others are well ahead in this regard."...

On the economics point, see https://seekingalpha.com/article/4667975-simandou-project-rio-tinto-bet-on-green-steel, where - discussing the economics of Simandou - we read

.." and the price spread between the higher (65%) and the 62% standard grades actually narrowed after reaching a peak in the year 2021. Apparently, the demand situation which determines utilization and consequently the margins of steel mills are the critical factors which impacts the price spread.....Therefore, Simandou primarily remains a bet on the decarbonization of steelmaking..."

OTOH, it DOES seem as though Zanaga may still have an ace in the hole with the low amount of its post-benificiation impurities (alumina, silica etc), which are lower even than Simandou.

And you've helpfully highlighted the additional 'green' tick-boxes of hydro input and 'low emission' slurry pipeline for export....

Recalling that the ZIOC 'team' earned their spurs on 'early Simandou', I really wish AT had come back on my AGM 'wrap-up' Q : which did they think would be first to export commercial quantities of ore - Simandou or Zanaga?

Hopefully, still an open question !

GLA and ATB

Having had a gander at the posts in question, I've broken the usual habit of a lifetime (giving folk the benefit of the doubt) and added the writer to my shortlist of filtered posters.

Well, 'being invested' puts comments in context:

It suggests that - hopefully - you've done a certain amount of research, so may have some basis for your views (which increases their value).

OTOH, you may be prone to 'confirmation bias', which may reduce their value.

Either way, it gives the reader something to bear in mind and us more than the comment from a random stranger.

Posting history over time is obv 'worth' more, but we deal with the world as it is, not as we might wish it to be.

At least IMO.

Hi Jiving,

I was holding back to see if there was any news out of Riyadh today, close of PIF's Private Sector Forum.

There's talk of deals struck by a local coffee company, but that's it, so far .....

https://www.zawya.com/en/press-release/government-news/at-pif-private-sector-forum-saudi-coffee-company-inks-9-key-agreements-t5omamws

Coming back to your thesis :

.."2023: Iron ore Mineral Resources and Ore Reserves have not been re-estimated since 2015 (refer earlier Glencore reports). Glencore is no longer an active participant in the previously-disclosed Zanaga project. The REMAINING iron ore projects are not financially material to the Group and are, therefore, not reproduced in this report."

(1) The reason for dropping Zanaga -as an 'inactive participant' - rings hollow, as others have commented. It would be interesting to check if there any other, 'minority interest' shareholdings that continue to be reported (I'm not familiar with GLEN) and what is the customary threshold for 'inactivity'? It can't be 'mind or management', given Marty + 2 x BoD positions. Is it absence of ancillary roles, such as offtake or marketing?

Whatever. After the (debatable, IMO) reason for dropping Zanaga, ALL other projects are excluded explicitly for 'lack of financial materiality'. By inference, whatever the issue with Zanaga, financial immateriality isn't it. A back-handed compliment of sorts!

..."So this in the view of the report compilers, is a notable change of status in the period 2022-23: "Glencore is no longer an active participant in the previously-disclosed Zanaga project. " As ever we have to clutch at straws, but it could indicate a disposal of Glencore's ZIOC equity stake (as opposed to its offtake interest) is possibly agreed but "subject to..." finalisation of details? "

Seems likely to this straw-clutcher ;-> !

I go back to Wilt's emphasis on Ma'aden's offtake aspirations and the unanswered question of whether advertised attendee/speaker Gary Nagle of GLEN actually showed up or not? Maybe a diplomatic absence, to avoid being put on the spot re its (ongoing ?) offtake interests?

We await 'events'

'Dum spiro, spero'.

GLA

Agreed re opening t/p !

Note that I started by arguing the thesis of 'benign neglect' by the 2 core shareholders....other bees are surely now buzzing around the honey-pot (to mix metaphors).

GLA

That's an expensive albeit simple solution!

My view is that there's such a disparity between the current s/p and what we believe it's worth that it's in the major shareholders' interest to shake us out if they can, either themselves or through 'friends'.

Suppose that casual, unconnected PI's hold, for the sake of argument 5% of ZIOC between us, say - for the maths - 30m shares.

They're currently 'worth' @ 0.08 abt £ 2.4million, as opposed to £ 30 million for EVERY 100p achieved if eventually included in a formal sale.

My t/p was 200p, at which level these 30 million shares would be worth £ 60 million.

There's a lot of City (or personal) bonus you could earn for 'buying low and selling high'....Talk of £ 4 to £ 5 and you're looking at a serious incentive to game the system.

It doesn't have to be investors for the longer term, either, if our understanding is correct, they could pre-agree/have pre-agreed to 'flip' to a core investor and deliver a useful chunk of shares to whomever.

You only need 2 arbitrageurs for this to remain safely below a disclosable threshold, AFAIAA.

Jes' sayin', like.

GLA

I worked for Lloyds Bank in the '70's, back when Sir Jeremy Morse was Chair. Lloyds had a tilt at Standard Chartered, which ultimately failed when a 'white knight'appeared and blocked the deal.

Apart from that loss, the biggest problem - apparently - was dealing with major M Eastern shareholders in Lloyds (Easa Al Gurg, being one), who were VERY upset that Lloyds hadn't tipped them the wink beforehand and allowed them to 'help' the deal go through.

The concept - and illegality - of 'concert party' dealings of this type was alien to them -and tbf most bankers of that generation.

I suspect it's different now.

I believe ZIOC will play this with a straight bat, GLEN I'm not so sure about (but Gary is under some pressure to show a 'clean pair of hands', so I think/hope that GLEN will also do the Right Thing).

The reality, however is that there's almost certainly a policy of 'benign neglect' towards us , in that the fewer PI's there are the easier things can proceed (assuming they are!) administratively...

That's my take, anyway.

GLA

.."Looks like we have another live one chaps 🤦🏻‍♂️.

Not from the neck up, it seems.

Hi Jiving,

Another factor for the inactivity over 2014>2016 may well have been that GLEN itself had other things on its mind : from an old Align research paper that I stumbled across whilst re-connecting with Lemonfool was this snippet :

.."In recent weeks the price of iron ore has continued to build on the bullish momentum seen this year with China’s slowing being less than feared and, as a consequence of the mothballing of many ore projects in Australia and Africa, a much reduced supply profile over the next several years. Key issue for ZIOC is the structure of the project company (“Jumelles”) and in which Glencore are their partner holding 50% + 1 share and thus giving them control over the venture. Given the very questioning of Glencore’s own survival at the end of 2015 that culminated in a large equity raise backed by the Directors of that company and other institutional investors, large scale Greenfield projects were put on the back burner, particularly those costing upwards of a billion dollars to catalyse..."

That was then; this is now : 'long ago...and far away...'

ATB

Good point!

LTH's -which obviously doesn't include you, unless you previously posted under another moniker ?- will be aware that Big Den has connived at the destruction of Congo rainforest by logging for many years, so his 'concerns' are very much for public consumption....and political/financial gain.

Which isn't to say that ESG concerns won't come up in any 'environmental permit' negotiations that may be necessary.....

HTH

OCN is sufficiently interested to have RNS'd the Edison report.

Piedro commented 'If you check back I think you will find that Edison makes a report every 6 months

or so, all of which get RNS'ed'

Thanks for the prompt.

It looks to have been

June 2021

May 2022

Sept 2022

Oct 2022 (released Nov 2022)

Feb 2024

GLA

Thanks for this link. It reads like part of a 'defence document' (timing?), doesn't it ?

Not just your quote ( cf my earlier ' SWF asset stripper' speculation) , but also this :

.."In Exhibit 1 we attempt to value OCN. Firstly, we took the last published equity value (30 June 2023), excluding minorities, of OCN of US$565.2m, or £444.1m. Secondly, we subtracted the equity value at the same date of OCN’s 57% stake in PORT3 of £206.2m, leaving an equity value of OCN (ex PORT3) of £237.9m. Finally, we added back the current market value of OCN’s 57% stake in PORT3 and arrived at a market value of OCN of £906.7m (or 2,564p/share) against a current market capitalisation of £443.8m (1,255p/share). This implies that OCN trades at a 51.1% discount to its market price value despite the bounce in the share price this year, from a low of 820p on 9 June to the current level. This calculation does not include any potential increase in the value of the investment portfolio since the last published date of 30 June, nor any additional profit accrued from its holding in PORT3 since that date..."

Followed by 'bid premium' reference :

.."PORT3 is trading on a 2023 EV/EBITDA multiple of c 10.0x, which is close to the average multiple of a group of international peers (FY23 average of 10.5x) and so we consider this to be relatively conservative given the M&A upside of this particular asset at the moment and the significant growth that PORT3 has demonstrated throughout 2023. For reference, we estimate that each 0.5x of EV/EBITDA ratio added raises the total value of OCN by £44.3m or 125p/share..."

GLA

.."their total holding would drop below 50% of the A shares.

OCN would have the cash to buy Hansa, but that would definitely fall under the category of invested interest when it comes to the 2 family's & so they wouldn't be in a position to vote on whether to approve such an offer & I'm sure the rest of us would vote to reject such a move & would be asking the directors to step down for wasting our time & money...."

All very complicated....

And from Last of the Mohicans

.."Personally if Wilson & Sons is sold, I don't see a merger between OCN & Hansa Trust happening.

Its fraught with complexity.

Hansa has 2 different types of shares in issue the voting ones & non-voting ones. The 2 family's control enough of the voting ones to keep control of it. However they don't have a majority ownership of the non-voting ones (There are a total of 40M voting & 80M non voting)

At OCN they own just over 51% of it with half of that ownership coming in the form of Hansa.

Who would make the offer for the other?

It would needs to be priced at a price that the independent directors could justify it as being in the best interests of shareholders to accept (both companies).

Hansa NAV currently sits at £427M but the shares trade at a discount of over 40% currently to that valuation & they still don't carryout buy-backs of the A shares which they have the authority to do.

Over 27% of that value comes from the OCN holding meaning the rest of the Hansa portfolio is worth £300M max & the OCN % will have increased since the end of Dec to possibly 30% or more now.

OCN has a market value of £495M currently for the 35.36M shares in issue, but the current implied NAV is over £23 per share, ie a value of over £800M at the current Wilson & Sons price.

So working backwards, the non family shareholders own roughly £400M in OCN.

The family own roughly £200M of OCN & Hansa slightly over £200M.

That means the cash value of Hansa would be around £500M in total, or over £4 per share. The 2 family own under 30M shares, so I'll assign them £120M to be on the safe side.

So the £1.1 Billion we're talking about in total is split into 3 groups the 2 family's have £320M of it, £380M of it belongs to the other Hansa investors & £400M of it belongs to the other OCN shareholders.

Leverage wise you'd say its still possible for the family's to still keep control of the empire in a convoluted structure but its going to be extremely difficult to do & the vast majority of shareholders in OCN & Hansa know what's coming.

They've seen the years of pathetic Investment performance that Hanseatic have given everyone, they are not going to put up with it, they will want cash so they can get away from them & get decent returns on there money elsewhere.

The breakdown of the assets show's that Hansa doesn't have the cash to buy OCN all it could do is offer OCN shareholders shares or a cash/shares combo, but no-one in there right mind is going to take A shares in this day & age & are highly unlikely to take even the voting shares unless there being offered full value for there OCN shares. But in doing that the 2 family's would lose control of Hansa because they only own 25% of OCN compared to our 48% & when that's converted into Hansa A shares there total holding would drop below 50% of the A shares....cont...

From Mancman1

.."Ownership looks quite complicated. I think William Salomon owns 27% of Hansa and 13% of Ocean Wilsons, and Hansa owns 25% of Ocean Wilsons. Ocean Wilsons owns 56% of Wilson, Sons. Christopher Townsend owns 11% of Ocean Wilsons. Salomon is on the Board of all three companies, Townsend on the Board of Ocean Wilsons and Wilsons.

I can't figure out how you would untangle all that and simply merge the two companies.

I imagine that highly paid corporate lawyers will come out with a solution that benefits the major stakeholders..."

"PSA Is Said to Show Interest in Port Operator Wilson Sons

Controlling shareholder Ocean Wilsons is reviewing investment

Ocean Wilsons says it’s received offers for its stake

By Vinicius Andrade and Manuel Baigorri

January 31, 2024 at 1:07 PM GMT

PSA International Pte, the port operator owned by Singapore state investor Temasek Holdings, has shown interest in acquiring Wilson Sons SA, a Brazilian port and maritime logistics company, according to people familiar with the matter.

Potential buyers in China also have shown interest, said the source......"

Maybe, baby....

Ashmore's latest offering is a 10 page PDF, too long to reproduce here. The executive summary gives a flavour and an outline road-map.

.."THE EMERGING VIEW

The Last Tango: The Path to Make Argentina Great Again

By GUSTAVO MEDEIROS AND BEN UNDERHILL

The most interesting investment opportunity in 2024 is also the most controversial.

Investing in Argentinian assets could deliver extraordinary returns, if Milei manages to implement his most essential economic reforms. However, even optimistic economists and analysts struggle to see an open path for these economic reforms to work. This paper does so, proposing the ideal reform sequence, by which Argentina can regain the economic dynamism it displayed in the late 19th Century.

Milei, with the support of Sturzenegger and Caputo is now engaging on Act I, restoring economic competitiveness, balancing fiscal accounts and re-profiling a mountain of short-term debt. This act will be the most difficult to pull off, as it directly challenges the establishment – the Unions and Peronists who have held power for nearly 75 years.

Act II will be simpler, involving a monetary stabilization plan, through which Argentina should benefit from a triple inflow of Dollars from exporters, foreign and local investors.

The third act will be the notorious dollarisation. This will be the least crucial but most controversial of the reforms, in our view, and may become the theme of many Tangos in the future."

GLA