Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Well said, JohnTG. It seems that some people think the RNS is for promoting or maintaining the SP. They should be aware that publicly quoted companies have to follow rules, even AIM. The RNS is only for defined purposes, attempting to prop up the SP is not one of them. The content of an RNS must fall within the rules or state that it is not news, which undermines the purpose of publishing it.
Still up over 5% on a volume of over 6m. Perhaps the weekend drew the line under the SP fall and it will steady up now and start to rise over the coming weeks/months as people have time to make proper assessments of the Kallak conditions and the value of Finland/Kosovo
Yes, a very good article. Particularly helpful to see some analysis of how the Sami don’t back environmentally friendly measures. Sadly only a small circulation business magazine, but good to know there are some Swedes taking a more nuanced view than reindeer/Greta good, mines bad.
Nick, I could be wrong but the M&A teams of a major iron ore miner might think BEM could be picked up fairly cheaply, cost amortised in accounts over likely revenue lifetime of a mine and anything not wanted spun out after purchase.
Nick - I think anything is possible, even a total purchase of BEM. All I would say is that if BEM ends up with profits/proceeds that go beyond reasonable working capital requirements we should expect a special dividend or share buy back to distribute it.
Would it be fair to say that all the Swedish PI sentiment that drove the SP up was based on the notion that the concession was the answer to their prayers? They then took fright at the conditions that came with it (which I think most of us expected)? If so, any Kallak SP re-rate is now dependent on satisfying those conditions or news of a mining major making a clear and favourable statement of intent towards BEM/Kallak? Finland and and Kosovo could, of course, lead to a re-rating before that. Or are there other views?
Wotitsworth - for a "small" deal like this I don't think RIO et al would build a stake as they would have to make it significant to act as a deterrent to another purchaser and could trigger a compulsory offer. It would also signal a level of interest they may not want to give ahead of any negotiations. More likely they put a take it or leave it offer on the table and make the BEM BoD sweat. That's why Kurt needs to create some competition among potential bidders and he probably needs some top-flight help to do that.
Wotitsworth - last week or so makes me think WDIK, but if option 1 is about building a mine, I think there's more to it than just funding. BEM's latest profile shows 10 employees. The company could have millions in the bank but the amount of recruitment needed would be immense and it's not easy just to buy in know-how you can trust. A sale seems much more likely and I don't think LKAB would be the only bidder. Kurt could even use someone like RIO to get some kind of competitive bidding process going. I hope he's already spoken to all the major players (starting years ago) so it's now a case of continuing conversations to account for the concession rather than starting from scratch.
It’s been a funny old week; the thing we’ve been so desperate to get turns out to be the thing that halved the company’s value (for now). I realise that all I know is that BEM is in a better position that anyone else to monetise mineral deposits in Sweden, Finland and Kosovo. How and when that’s achieved and how the SP will react…..I’m giving up making assumptions or predictions about that. I’m strapped in and will enjoy the rest of the rollercoaster ride. GLA
This has gone beyond profit-taking and is now panic. The volume of shares traded in Sweden is on the rise again, 33m today so far. Small investors who tried to keep faith for a few days but are now rushing for the exit. I’m not panicking btw, still invested and not planning on selling.
I've been watching the SP over the last few days with the same mix of uncertainty, surprise, disappointment, annoyance and denial as many of you. What I still find remarkable is that in the last 5 days well over 300,000,000 shares have been traded in Sweden. There are only about 630,000,000 shares actually in circulation there. Most of the trades are still really small - a 10,000 share trade would be on the large side. Obvs there are a few for 100,000 or even more, but the vast majority are a few hundred or thousand. Were there really that many small PI holders in Sweden that have taken 5 days to be shaken out? Seems very curious to me that a nation of shareholders capable of driving the SP up to 20p on hopes of a concession would then want to bale out in very unceremonious fashion the moment the concession is granted just because there were widely anticipated conditions attached. Weird and illogical to me. All I know is that £390m tonnes of something worth $150 per tonne is still there and isn't coming out of the ground without BEM's say so.
Thanks for the link, Andy, very interesting comments from Kurt. I doubt he would have been in Finland if he knew the decisions was going to be announced, so I think K-PT was working to his own timetable (March!) and caught everyone on the hop. I bet Kurt’s phone has been ringing off the hook ever since; advisers, financiers, agents, potential partners perhaps even a reindeer herder or two. There’s no advantage to BEM in rushing out an RNS right now just to push the SP. The conversations going on now are complex, we’ll hear about them when it’s in the company’s best interests. We have a concession to mine 380+ million tons that has a market value of $150 per tonne. So many noughts I can’t even do the maths. Patience ;)
Yes Andy, some IIs would help the SP a lot. Only 27m shares traded in Sweden yesterday, but the total for 3 days is 287m. That’s 45% of all the shares in Sweden. We know that the average trade size was very small, less than 10,000 shares. So that looks a lot like pocket money investors getting out. Question is, who bought those shares? Have they been accumulated into larger holdings by strategic investors who saw the opportunity or have they just been rotating around other small scale investors. My hope is that it’s the former.