focusIR May 2024 Investor Webinar: Blue Whale, Kavango, Taseko Mines & CQS Natural Resources. Catch up with the webinar here.
Quite how it will all fit together and who will deal with what is still a bit of a mystery to me tbh, but at least none of it looks like bad news, and hopefully it will improve the regime. This new independent regulatory body seems to be the entity that will actually grant mining licences going forward.
Not the clearest article ever written, but it looks like it's only about creation of a new independent regulatory body. A Malawian anti-corruption thing, rather than extending the scope of the legislation to accommodate MKA's or other concerns. Hopefully no moratorium or delays on new licences/MDAs whilst it progresses. That would probably have to be RNSed.
I guess it's perfectly possible MKA could sell Songwe to the Chinese but I don't think it's possible Malawi could or would nationalise Songwe at undervalue or otherwise rescind MKA's Songwe licences. Malawi's building international credibility for example with the US and with deals like with GBE. The money Malawi will get from the royalty and equity stakes in Kanyika Songwe etc depend on its political fiscal and legal stability. Malawi's maturing.
Aha yes here we go. Great news. At last this will go in front of a court. I imagine judgment won't arrive till around the election at the earliest. If this conwoman Ribera and the rest of the clowns get booted out a new government should permit anyway. Or if God forbid Ribera comes back she'll have to commit public funds to appeal any judgement in BKY's favour. That could be tricky even for a brass necked idiot, time could be up for her quite soon.
The GBE MDA terms are informative for MKA and there's some read across. MKA's project is also unique of course so the shape of our MDA could be very different.
MKA is still a stonking buy imo. The broad mine refine recycle business, demand for REs without Chinese involvement, and our other assets etc etc.
The GBE MDA terms per se seem reasonable. A 5% (tiny .45% local) royalty (even gross) reflects the benefits of a stable political and tax regime (the latter written in to the MDA for 10 years). If the starting point is say 0 to 15% it's fair. 10% state golden share fits well too and the 10% fully contributary option is on balance positive for future funding.
Why the tanking SPs? Presumably the wider risk off approach of the market to growth stocks like these, credit crunch concerns for funding GBE/Songwe and geopolitical concerns with Malawi's difficult recent history etc etc.
Wtfdik and all IMHO of course but definitely a buy at these bucket shop levels and gla.
Is 10% equity and 5% royalty really that "awful" GLR?
Seems to compare reasonably with other regimes in Africa and worldwide. And particularly given where Malawi are, what they've said to date and the historic problems with Paladin. There's some decent tax breaks and fx account provisions to satisfy lenders in there too.
Wtfdik too but on the face of it a 10% golden share (with option to buy another 10%) and 5% royalty looks fair enough. The fx provisions look fair too. MKA's funding or sale plans may be further advanced too.
The Globe announcement in full...
https://www2.asx.com.au/markets/company/gbe
It'll be interesting to see what the market thinks when Globe gets its MDA. What will its SP do, what will Globe and the market experts and commentators say? Will MKA SP follow? Potentially very exciting times for MKA.
Assuming Globe does get its MDA in short order it will be informative for MKA shareholders to see the terms (and how reasonable they are) particularly as they relate to the crucial points of tax royalties and fx. I presume these will be announced on ASX. It's a very significant and positive development that the MDA seems to have been granted imo, assuming fair terms.
Lots of moving parts in these negotiations. Shareholders and lenders interests included. MKA must make sure they get fair terms. It's not our job alone to solve Malawi's foreign currency crisis for example.
Difficult to guess timeframes to MKA MDA completion. Hopefully not too long though particularly now there's a precedent with Global Metals presumably on fair terms. The same issues seemed to be holding that up.
This share still a strong buy imo. Just a bit more patience needed.
https://mwnation.com/govt-guards-against-exploitation-in-mining/
This article from mid Jan explains the ongoing forex/tax sticking point issues well.
At that point the Globe MDA review was at 90% and MKA review at 70% with both companies understanding Malawi's position.
Lack of fx currency is a big issue in Malawi.
If Globe are now at 100% maybe MKA 's up to 80%?!