Member Info for GLR1990

LW that's my end game here

Why I am not overly worried about the short term cash position, if we raised at group level (even at 6p lets just say to remain unbiased) is £1m dilution really that much of a disaster? It's less than 10% of the group, so the market cap goes to £16m instead of £15m... big deal, we still would own

- 40% of the US JV

- 80% of the UK operations

- 60% rising to 90% of the German operations

- X amount of any new business (Canada, ME, Japan)

Let's say we get to 100t/pa by the end of 2024 (so 2025 would be a FY or 100t/pa scaling up) at minimum that would be £5m GBP in revenues at today's NdPr pricing, that's not to say we could receive much more for creating the finished (approved) magnets

If the German plant starts operating in 2025, then by the end of 2025 you've got two plants producing 100/tpa minimum (~£10m+ revenues)

The US plants could be fully funded by then, or if not fully funded using an IPO and the blueprints / business model from UK and Germany? How much would a £10m PA business that has three new plants fully funded (taking it to maybe £30m PA?) IPO for in the US? I would be shocked if it were less than $150m USD.

We would currently own at least 40% of that IPO (packaging it all up could take us back to 50% perhaps?) that's $75m USD, and that's if it IPO'd at $150m - by that stage it could IPO for much more (Peers are $300m+)

That IPO alone would be a 500% return on our current shareholding

Now if we move to refining (EU just passed a bill for 40% refining) with Grupa in Poland "Pulawy" how much is this worth to the business?

Lynas have received nearly $300m USD to build the exact same plant in the US

The EU has funded one plant in the pipeline in Estonia, and maybe one more in France - so there's tons of room for more processing plants

If our Pulawy project is accepted in the next 15 months (new EU timeframes now for processing) how much value does that add to MKA if the project will likely receive $100-200m in funding? That alone would surely push our share price up to Pensana levels at minimum (mine and processing plant) which is trading currently at £85m GBP (a 600% return from our current share price)

Now you add in Songwe economics, which as per the DFS they estimate (post MDA) that Pulawy if it were in operation, would improve the Songwe economics by 35% (not having to process in China for example) what would an MDA and investment in Songwe do to our share price? Maximised by Pulawy? £50m cap, £100m cap? Again another 600-700% rise

So if all goes to plan

Maginito could add pre-IPO 6-700% to the SP

Pulawy could add, if similar funding like in the US occurs, a 5-600% rise in SP

MDA and funding for Songwe, again 500%+ to the SP from this level

MDA, Funding for Songwe, Pulawy and a Maginito IPO in Q425,2026 what price do you put on all that?

It is really not out of the Q to see this 10x or more in the next 12-18 months, I've said it before and been wrong b

Malawi is as Malawi does

We all thought originally we were investing an a stable landscape however the last few years have really hammered Malawi hard, from the cyclone and of course inflation due to mass QE and 'all at once' re-openings.

The ministry are taking as much time as they can with these MDA's, for reasons unknown. At first we they blamed the Paladin deal, to never happen again, however Songwe et al could all have been looking at production in the next 9 months if they had agreed terms early on. Now it's going to be at least 2 years, maybe longer as the investment landscape has collapsed, arranging finance will be much more difficult today than it was in 2022 - so Malawi has truly missed the boat, well at least the first boat and we do hope another comes along. The sad thing is, its the locals that suffer the most whilst the politicians make it look like they are playing hardball, but where do you draw the line between hardball (a country that has devalued its currency and been bailed out by the IMF) and investors who want to progress mining operations on your territory and take all the financial risk?

Hence, MKA should be in no rush to begin operations, the investment has zero value on the books and is simply an ongoing cost that we should mitigate as much as possible.

Turned down Donald trump but not Julian Treger

Certainly an interesting addition, specific for rare earths and critical minerals

As said before, HyProMag certain has some value behind it. We do need to find a way to get the market to realise this however...

No way he was exec for Paladin!

I’m sure they will get on very well, was not aware at all he was involved in Paladin… wonder if he would be interested in venturing back into Malawi

If there was a way we could reverse the CLN (which I think is possible) we could raise 2.5m euro today

Mkango raised £3.5m

Provided a 2.5m euro loan to HyProMag Germany via Maginito

As of Sep 2023, not a single penny of this had not been drawn down

The Euro grant was 3.7m euro, we had to pay the rest (hence the CLN) to fund the German Pilot Plant

IF, and its a big IF, that plant can secure funding from elsewhere (the MSP for example, I mean if you want critical RE's why are you making a small struggling company stump up 2.5m Euro!?) then we could reverse this CLN, get an extra £2m in the bank (GBP) and at the same time, secure lucrative funding for the German plant

It may be a long shot, but the BoD are as shrewd as they come

Should this come to fruition, I suspect the SP would at minimum double overnight

This is a potential long shot, nothing has been confirmed AT ALL in this regard and is total speculation

We paid £5m for the remaining 51% of HyProMag

Surely we didn't get swindled by a University!

Placing at 5p or below would actually confirm to be the case

This is how laughable it has become (in a painful way)

I am not saying it WONT go lower btw, I am just saying mentioning 4-5p, even if you despise this company, you have to realise that is such a ludicrous, downright insane valuation and even the biggest deramper and non-believers would be piling in at 4p.

If I am Cotec right now I am rubbing my hands.

There was a deramper on here who said 5.5p and I almost posted (it was 8p) at the time saying you cant be serious with that prediction, yet here we are.

The issue with the deramper provided no logic, so likely a lucky guess, yet there were tons of logic for supporting the price at 8p+, yet here we are. So to that deramper, Kudos.

On the note of Mkango, the Avacta fallout has clearly accelerate a movement away from anything that might need cash, and possibly any company that is pre-revenue. Avacta was a retail favourite, so the message has reached all corners of the market now.

The market will believe if Avacta, a retail favourite can place at such a whopping discount, then no company is safe from the institutions.

This is the biggest test our board have faced in their tenure, do they cave to the market and conduct a placing at what would now likely be 5p or lower, or do they find a way to create even more shrewd value, in which they have done many times before.

I believe in the Bod, we have good partners in Cotec who have funds available, but this is a very tough market and anything can happen.

Do we even need to fund? I am sure we will find out soon once the Q update is released.

Tough times, but better days lie ahead for this company, we are far from the finished article albeit we must navigate this storm.

The 2.75p covid lows aren't even that far off, which gives you an idea of how crazy the current valuation is. True panic has now gripped the market, only the strong and the brave will survive.

There's nothing wrong with RE's themselves, its the way in which they are processed / mined

If there was a replacement compound or element, id be more nervous

Ferrite has been touted as a potential replacement, however it doesn't come close to the performance of Nd magnets

A recycled NdFeB magnet trumps all other sources, because its 100% environmentally friendly, removes a waste liability in the process (landfill) and allows companies to say their products are made from 100% environmentally friendly, domestic sources.

There would be no Q about choosing RE's if they weren't difficult to mine in a friendly manner, although a lot of mines outside of China only have 30% of the environmental damage of some of the Chinese mines.

Recycling is the biggest threat to mining, which makes you wonder how this will all play out.

Probably the worst couple of weeks on the markets since the covid crash 2020, we hit 2.75p at the trough (38p at the peak!)

I recall the 2.75p days, we had 2x more cash in the bank vs our market cap - the market didn't care for that at the time of course, 1500% rise later you could have made a pretty penny

Now we are arguably valued at less than the 2.75p, back then we just had Songwe and HyProMag was an unproven asset worth £500K on the books

Four years later, our SP is just over double what it was back then (albeit dilution, so more closer to treble mcap wise) yet we have a proven rare earth recycling technology on the books that we own 80% of, with exposure to not just one but potentially five of these reactors. Impressive.

Songwe has been fully explored, a DFS produced that cost over $20m+ and simply awaits an MDA - one of the few construction ready RE assets in a friendly territory, albeit one that has inflation issues but its still a friendly place to operate.

Would I rather buy now at 6p with all what we have, or buy at 2.75p and reverse all the hard work?

Todays price appears to be more attractive

Back tot he price I first invested in at the back end of 2017, ~6.5p (waited for the dip after the initial Talaxis $7m was received) and thought, this is a company that knows how to get a good deal done.

Since then, they've actually signed numerous, very good deals!

Bought HyProMag for an initial £500K + option to convert an extra 8-9% for a 49% interest

Sold 20% of Maginito for £3.5m

Then bought the entirety of HyProMag for ~£5m (already owned 49%) giving it a face value of ~£10m, however Cotec paid £3.5m for 20% so that values it around £17.5m

Added more value to HyProMag via

- Placing for raise funds for a German plant + 3.6m Euro Grant

- Started at £.4m wind turbine project

- Concluded the UK first NDPR magnet commissioning post a £6m project

- First revenues commenced in Birmingham, POC completed

- Partnered with Cotec to set up 3 plants in the US (pending US govt funding ) and a magnet production facility

It's safe to say, the BoD have potentially 20 bagged the original £500K investment in HyProMag

We also have a Uranium asset, where the price of the commodity is up considerably in the last 9 months (100% spot rise, which sounds even better if you consider say at $50 spot price your profits may be $10, now your profits are up 600%)

Would be shocked if our strategic BoD are not initiating a JV as we speak... hang on does anyone remember this?

https://mkango.ca/news/mkango-announces-us-2-000-000-earn-in-agreement-with-metalnrg-for-the-thambani-uranium-license/

Was terminated because we eventually lost faith in Metal NRG (investors helped a lot with that one)

That was when spot price was $23, it is now $106!

So there may be a lot of JV interested parties knocking on our Thambani door

In terms of the MDA, I think it has now become a running joke. That happens on AIM, it comes with the territory. We will keep plodding on until terms are agreed, at this price and market cap it really can do us no harm now to keep our feet firmly on the ground and make sure we hold out for the best deal possible for ourselves and Malawi of course.

In terms of raising capital, when you take into account all of the above, you'd think we'd have multiple options! Maybe the amount of time this has appear to take, shows the complexity of it

- Do we sell more of HyProMag via Cotec?

- Do we look for a JV for the Uranium Asset? Or do we just sell the asset?

- Do we simply raise at equity level?

- Do our directors have enough for quick bridge loan?

- Can we sell a royalty for Songwe?

So many options, one hopes the final decision is not a discounted equity raise at 6p!

Should in theory be OK from here (all theory of course)

Strategic investor 00Nation taking 13.5% at a price of 0.5p, with option to take a further £500k at the same price on 'commercial agreement'

Speculation around what a 'commercial agreement' will include, hopefully some sort of crossover as their CS2 team was far superior to ours (and we need one for the world cup at minimum)

On the above note, buying at 0.48p seems like a good price. Obv anything could happen, but I don't think 00Nation would be too pleased if we raised below this after them taking a 27% stake.

The recent balance sheet showed they reduced costs by almost half in the last year, lots of work to do to remove that cash loss but perhaps this is the way. Still paying becks £1.75m a year, not the £3m+ gravy train he was once part of but thats a major major cost for a £3.5m company although do wonder without him would the company perish as its reach would be absolutely destroyed and sponsors could leave.

Guild might need to improve its counter strike team if it wants to attract sponsors

Knocked out of another tournament so no LAN exposure

00Nation our new investors team just disbanded, I bet we pick a few of their players up for to create a counter strike team worthy of sponsors

Decided to take a bit more, can't believe sub 0.5p was on offer but here we are

My take on recent developments:

https://twitter.com/glr_1990/status/1755148240154935721

I am unsure what Guild have planned, if you asked me 6 months ago I thought Sky may have been interested in a buy out, or sponsoring the CS2 team 'Sky Bet Eagles' sounds pretty good, but with 00Nation taking 13.5% and potentially taking a further 13.5% for £500K (which now looks super likely, as they've already disbanded their own CS2 team) it's difficult to predict accurately what happens next?

00Nation have a host of existing sponsors (Inc XBOX) when they had a competitive CS2 team they also had Parimatch which fits in with the betting angle, however when the deal was first signed, it was signed on the basis of expansion to the MENA region (which ofc holds this years world cup)

A commercial agreement is TBC between the parties, how would that work between investor and company?

One way I can think would be if the 'Investor' handed over their teams / sponsors to the Guild Group (else why take a 27% position if it were vice versa?) and the Guild group either swallows up all the 00Nation branding (or some of it) and they combine to become an esports superpower (OK maybe not superpower, but you get the point)

Guilds Bitstamp partnership ends soon (March?) so there is room (and need) for a extra sponsors to come on board. CS2 is a leading platform to sponsor and the best teams do not come cheap, so we could be looking at some serious positive developments in the coming weeks.

Agree and its not like they can blame it on the carpet as it was successfully found

Its says clearly in the report when they will need to raise

Why hold if you can get lower in a few days?

Surely it would be better to sell now at 8p and buy them back, which going by your suggestion, is going to be sub 6p?

You told everyone yesterday who had the chance to buy at 7p to hold off and wait for sub 6p, the ask is now above 8p so hopefully for your sake it is sub 6p or you've cost people a lot of equity.

Maybe it would be better to hold off the price predictions for now and simply state that it might be better to just wait for whatever the placing price is before investing?

God Bless HyProMag that's all I can say here, can you imagine if it were still a £500K 41% interest after-thought?

We would be struggling to hold 4p never mind 8p

Agree CB 19 months delay now... which is beyond ridiculous

Malawi for me take a lot of the blame, if we were the only MDA outstanding I would think the blame lied more on our BoD but since there are four MDA's outstanding and the only one that did get signed was on terrible terms (10% royalty and a huge tax) I can see why the countries mining sector is almost non-existent

Hopefully we get some good news regarding the recycling plants and can focus on something else

Quite the sell off YTD, could be one of three things

- Placing (forward sold)

- Large seller had enough, taking us down a few pence before buyers get attracted

- Both

The buying today between 7-8p suggests to me if there is a placing, it wont be much lower than where we are currently positioned. As MKA is pre revenue, it's clear we will need to raise funds before we start making revs/profits from the recycling plants, as much as 20tp/a could bring in even at todays supressed NdPr pricing (although healthy relative to 2019) around $60K a tonne (So about $1.2m at current production) it wont be enough as of yet to get us through to Q3/Q4 2024, and that's if we just want to plod along, id rather we keep raising as long as its for projects that can add significant future value

If we do raise, it would be the method of the raise and the participants that would be key. I know its tough right now for anyone, and WD did add £100K at 12.9p so I suspect he may struggle this time around to add another 6 figure amount (I am not aware of his finances and don't care) DL added £700K at one stage, a huge endorsement for the company (24-27p) so we do have directors who can fund the day to day operations (Upon checking the Malawi delays, it doesn't appear to be that costly outside of obvious delayed future revenues, by my calcs it was around £250K per Q give or take when you strip out General Expenses / Admin)

So if we are to raise, bring it on. I trust the BoD to find and create more value. In the last year alone, they have bought 100% of the prized asset HyProMag, they've raised funds to deploy our technology in Germany, allowed us to take part and fund partially a crucial wind turbine project and more importantly, successfully begun commercial production in Birmingham (Proven the Tech) - they've also established a solid relationship with Cotec who you can be sure will hit the ground running with this in the US (they've already paid for equipment out of their own pockets)

The market has been extremely difficult, our basket price for Songwe has reduced considerably and the territory is dire (used to be good but not anymore) with inflation raging at 30% and international banks debating whether or not they should have any exposure there. hence raising money for both the company and our asset in this market is difficult.

Of course, post revenue a company may still want to raise with share capital, lets say we do scale up to 100t/pa by H1/Q3 2024, then that $1.2m becomes $6m per annum - large institutions may want a slice of the action and put double digit investments into MKA (Or more likely, its subsidiary Maginito) skyrocketing the valuation of the company and its technology

In summary, did Mkango have a good year outside of its share price? Mkango had an absolutely fantastic year in 2023 and there's no reason to believe it wont continue that progress in 2024. Bargain!

Good post TT

Unfortunately, we cannot walk away from Songwe, the economics and future value are too great.

We can in the meantime, focus our efforts elsewhere (thankfully, we have established a superb technology that now likely eclipses our current market cap regardless)

The predicted EBITDA for Songwe was £200m PA and it feeds directly into the Pulawy plant, giving both projects enhanced economics. If we walk away from Songwe we lose a hugely valuable asset for Pulawy and strategic importance for the EU

I can understand both parties interests, Malawi needs FX on home soil but large lends don't want to put their balances there (Looks at the IMF loans for example) especially since inflation is not yet under control in the country. The year on year inflation rate for November 2023 stands at 33.1 percent, an increase from the 26.9 percent recorded in October 2023 - Malawi is also undergoing severe fuel shortages, not ideal for building a project. In fact, I believe if we did get funding 12 moths ago, we would be looking at tremendous difficult today vs our original economics (similar to HZM) which could have crippled the company.

The best thing for us to do regarding Songwe, is establish our other projects and certainly don't show our cards. We are in a great position with HyProMag / Cotec, the market has crushed our SP down to a level where Songwe doesnt factor into any of our valuation. Remember Malawi needs this much more than Mkango do, OEMS and GOVTS need the product much more than Mkango do, it would be foolish for us to lose any ground just because it has been dragged on for so long.