Member Info for extrader

I've written to KP2 , anyway, but the relevant bit is in fact at the bottom of the RNS :

"The DX Project

In August 2020, the Company commenced the first phase of a Definitive Feasibility Study ("DFS") on the DX project, which is separate from the Kola project and situated in the Dougou Mining Licence.

The signing of this MoU with Summit and the request from the Minister to focus on the Kola project, necessitates a reshaping of the Company's priorities to increase the focus on the optimisation and financing of Kola over the next 12 months.

The Company is currently reviewing its allocation of resources to Kola and DX and intends to update shareholders on DX in coming weeks. "

Memo to self : read the WHOLE RNS...;->

Voting machine vs weighing machine.

Must admit, I'd prefer a clean exit.

More to the point, I'm sure Elphick ( now 60) would , too .....

He just has to remember to include warrants or similar to 'capture' a bit of our tag-along rights !

AT : if you're reading, pls note !

.."The take home point is we don't know. So saying 3 or 4 time net monetisation is a bit of a subtle deramp.
How do you know extrader??? "

I don't "know" - it's an 'educated guess' , based on the only hard info we have, contained in the 30/6 2020 RNS.

Worth a little more (maybe not much, granted) than the completely unsupported speculation that's so popular.

HTH

Q re no more dilution ?

From the RNS : "Under the proposed financing structure, the Company would not be required to contribute to the capital needed to build the project and would retain a 90% equity interest in Kola..."

KP2 also says that as a result of this MoU , it's pivoting its priorities away from DX to the main project. We don't yet know what cashflow implications, if any, that has..... the Company likely doesn't yet either.

They raised $8m in Sept for DX, had $ 5.6m at end Dec, we don't know what cash atm, from the prev. RNS there's a 'going concern' note re the period to March 2022 :
.."The Directors prepared a cash flow forecast for the period ending 31 December 2022, which indicates that the Group will not have sufficient liquidity to meet its working capital requirements to the end of the going concern period (31 March 2022), primarily being corporate costs, exploration expenditure, and DFS costs related to the Kola and Dougou Projects."

If you assume that the DFS 's for Kola and Dougou have been overtaken by events, it might well be that the 'going concern' qualification has gone away too.

As a relatively new investor, I haven't checked out what KP2's 'shareholder-friendliness' is like , I think I'll write and ask them.

HTH

HTH

.."The take home points were that there has been a potential increase in client uptake and we have appointed a CFO..."

You're overlooking the 'take home point' that 'gross' originations - the number being used by everybody up to now for all their earnings / share price projections - might be 3 to 4 times 'net' monetisations, which is the bit that matters.

IMO

Hxulcolrdoh - great moniker, btw !

I'd send your questions to Elizabeth Johnson, asking her to ask the company.....

I've got half-replies in the past, using this mechanism. I think it's because she at least has some standards.

HTH

PS

May be a coincidence , but 'read-across' co Kore Potash KP2 has today announced an MoU for the full financing of its proposed $ 2.2 bn Kola project

https://www.lse.co.uk/rns/KP2/mou-to-arrange-full-financing-of-kola-construction-mvbt9962q7i3ukt.html.

Worth looking at their proposed structure and think about how/whether this would work for Zanaga.

HTH

I think/hope this is may be a case of 'less is more'.

We're referred back to the Sept RNS that announced this (slightly delayed) re-costing exercise . That RNS then updates as follows :

"· Strategic investor discussions

o Approaches received from a number of strategic investors interested in investing in the Zanaga Project

o Discussions remain at a very early stage and there is no certainty that these discussions will proceed or a transaction ultimately entered into

· Other opportunities under investigation

o Multiple Chinese entities introduced by China Overseas Infrastructure Development and Investment Corporation Limited ("COIDIC") in order to explore opportunities for Chinese involvement in construction of the Project

o Opportunity being explored for potential development of a steel production facility within COIDIC's Special Economic Zone ("SEZ") at Point-Noire

o Yantai Port Group introduced by COIDIC to consider logistics synergies "

Today's RNS comes the day that C-B's Constitutional Court meets to decide various challenges to the recent election results that (cough) provisionally gave Nguesso an 88.7% mandate.

Let's see what happens.

In Boat Race terms, we may (repeat 'may') be ' in the short strokes'.
https://idioms.thefreedictionary.com/short+strokes
IMO
GLA

'Gross' vs 'net' as explained by SYME :

https://uk.advfn.com/stock-market/london/supply-me-capital-SYME/share-news/Supply-ME-Capital-PLC-Interim-Statement-12-month/82761501

.."The Originated Portfolio is defined as comprising a pipeline of prospective contracts that have been originated with client companies. At the date of the RTO the Originated Portfolio stood at EUR972m and currently stands at EUR1.43bn.[= 100%]

At the date of this statement there are EUR555m [ 555/1430 = 38%] of client companies ready to be served / for execution. We expect a significant proportion [65 to 70 % ? x 38% = 25 to 27% ] of these to be monetised once Inventory Funding has been secured..."

Mutatis mutandis, of course.

HTH

.." tell me of another company where a non-exec chairman holds (or should I say held) over 20% of a listed company. .."

He started out with 42 % of 92.2%.
SYME is 'capital lite' - as shown by the fact that they only felt the Company needed to raise £ 2.2m in the Placing.
Why would you generously 'allow' others to share in your good fortune ?

Answers on a postcard....

"Az said Net will be those that are monetised .....these won’t then be in the Net figure , how many others won’t make it "
.
The only 'hard' guidance we have suggests around 25 % , based on the 30/6 RNS, where the portfolio to 31 March is described thus

.."At the date of the RTO the Originated Portfolio stood at €972m and currently stands at €1.43bn.

At the date of this statement (30/6) there are €555m of client companies ready to be served / for execution. We expect a significant proportion of these to be monetised once Inventory Funding has been secured."

Based on 'gross' = 1,430 and 'ready' = 555 (38%), assume a "significant proportion" (= 65-70% ?), that suggests 'net' back
- then, at least - was nearer 360-390 , or maybe 25% .

Greensill fallout may affect demand for finance on one hand (= up) and tighter credit standards re eligibility (=down).

Having set the hare running with belated disclosure, AZ could save a lot of speculation and score a few points on the transparency front , by just giving out the 'real' numbers now.

He's going to have to do so in a few weeks anyway.

Time to make a virtue of necessity ?

.." Would be nice to think the aussies would buy us out to stop the Chinese getting their hands on it,or even the same could be said for the arabs..."

I wouldn't totally rule out something from left field, maybe even the septic tanks...

I didn't tag it at the time , but there was an interesting opinion poll posted in depeches de brazzaville a couple of weeks back - about countries most admired by the Congolese - interesting in a number of ways :

From memory, the US was first; France had slipped a few places (the thrust of the article, understandably an issue in francophone Africa); and China was - for me, surprisingly - waaay down the list . Maybe they're seen/resented as the new colonialists ?

Obviously, we don't know how representative the poll was ; how biased (possibly) the reporting; and 'public opinion' probably isn't a big factor in Nguesso's decision-making (;-<), but still....

If the US wants to hold off the Chinese for a while, a 'proxy skirmish' in Africa might be the latest iteration of the 'Great Game'.

Robert Friedland has recently taken the plunge in Guinea with the Nimba mine - having obtained MIGA political risk insurance (suggesting there is World Bank /multilateral capacity and appetite for 'difficult' Africa risk), otherwise he 'coulda been a contender'.

https://www.mining.com/friedland-backed-hpx-to-fast-track-guinea-iron-ore-project/

Let's see what - if anything - AT has to say .

Thanks Longlad !

A bit blunter than hitherto (parallels with Western chokehold over Japan as pre-cursor to WW2), lots of emphasis on Guinea.
Not a good idea to have a single 'point of failure' though.
Zanaga is an increasingly visible 'loose end', it would seem.
An imperfect comparison, but Tesco got its knuckles rapped a while back by buying up suitable sites in towns, not to develop, but just to deny them to the competition.
That might be Zanaga's fate : a 'sub-optimal' outcome, for sure, but certainly a possibility to be aware of.

ATB

On 27/3 , I posted 3 x on ZIOC (and 3x on SYME), I'm not sure which ZIOC post you're referring to.

ZIOC and SYME are like chalk and cheese. I'll leave you to work out why.

ZIOC is the ultimate 'passive investment', awaiting on events completely outside its control.

It owns the concession at Zanaga of what is now probably the last remaining large, 'not under development', premium quality, relatively low polluting iron ore mine on the planet.

Its shares are majority held by founder investors, led by Clifford Elphick (Harry Oppenheimer's former PA), whose other FTSE investment is Gem Diamonds (a $ 1bn IPO , where he's also founder and CEO). He's part of the SA 'establishment'. I've met him at a ZIOC AGM and he answered professionally the 3 questions I asked. To be fair, there were only 3 of us PI's there.

ZIOC's current M cap is £ 25m, it has 50% (less one share) of an asset where the majority shareholder (now Glencore, a major commodity trader MCap £ 38 Billion) bought in by investing $ 300 million .

'Monetisation' - if it ever happens - will be because a deep-pocketed investor 'takes the plunge'. It will probably take £ 2+ billion to develop. That needs the causes and conditions to be right. Lots of macro-economics and politics involved.

IF it happens , it'll multi-bag. Anywhere between 10x and 50x. NAI, DYOR, etc, etc
It IPO'd at £ 1.56 a share a decade ago, peaked at over £ 2 and is currently around 8p.

Opportunity cost aside, I'm ahead of the game. I don't think ZIOC management will scr*w me, although GLEN might try. If so, I'd expect ZIOC to fight my corner. It has various legal remedies and protections built into the corporate tie-up.

Causes and conditions were against it almost from the get-go (iron ore price slump), I've been a holder for 3-4 years, as one of a number of 'sh*t or bust ' shares at the speculative end of my investments.

'Missing a deadline' when there's rarely anything to report that I can't get from the FT (and sometimes the evening news) has happened before and isn't worth getting het up about.

It's mercifully mostly free of rampers and posts are generally from and between long-term , knowledgeable holders.

About the only thing that ZIOC has in common with SYME is that both invite me/give me a 'prompt' to get more informed about the world around me.

HTH

SYME is a one man band (who has already shown he's less than perfect) , now with a single source of funding (that is dictating terms).

No dependency risk there, then.

"The situation for one funder is not automatically a bad thing.."

Replace 'funder' with 'AZ ' and google 'key man concept'.

HTH

.."If he’s a tech guy, a regulatory guy and a salesmen that’s quite a broad skill set for one person to be the master of..."

you missed out the most important skill needed at this stage of business incubation , IMO : 'commercial awareness'.

Dependency on a sole provider is an absolute 'no no' in the business world and invariably leads to 'sub optimal' outcomes.

This applies not only to funding - as people have remarked - but also to individuals. As we are seeing.

Hi beardozer,

Glad you're enjoying the poem ! There are a lot of 'life lessons' in its verses, about priorities in life etc, many seen through the eyes of a 'bon vivant' who enjoyed his wine - maybe that's why it resonates ;->

.."That's all about selling too soon!.."

Quite ! Imagine your finger hovering over the deal Y/N ? button ....

.." The Moving Finger writes, and, having writ,
Moves on; nor all your Piety nor Wit
Shall lure it back to cancel half a Line,
Nor all your Tears wash out a Word of it.."

Good for any 'life-changing' decision .

Happy Easter !

.."Who is the beneficial owner of the stock? That is a question for the regulatory authorities.."

In the long run, yes. More immediately and practically , it's the cornerstone of the funding decision, as it's the basis of the funder's security :
if I have any doubts about the quality of due diligence or ( timely) enforceability of security, why lend ?

The flip-side of convenience to customer of having stock to hand in his own premises is a negative to the lender that no amount of blockchain wizardry can get around aka "possession is 9/10ths of the law".

The subset of inventory that is 'in transit' (good if cross-border, better if by sea/air) appears to address this issue, which is probably why it seems to be working.

IMO