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It looks like it will exceed my first ever purchase of HZM back in 2014 at 7.2p - been a long wait to get back to this level but never had any real doubts about the final outcome. I was under a different moniker back then and a bit of a lone poster nice to see a lot of good input grow over the years. Taken advantage of price drops along the way and have a healthy holding up around Dj's if you include the wifes share at an average of 3.8p.
I have a large file on Horizonte and the Nickel space and have had several conversations and a few meetings with JM since 2014 plus have attended a few AGM,s normally with the same small group of like minded investors.
I have just been going through my file and looking at notes made of conversations over the last 6 years and it is apparent that JM and the board have instigated everything they promised, Sure there have been a few time lapses and Jeremys interpretation of imminent has always been different to the markets but it does seem as though we have accelerated into the fast lane.
I have just looked at a meeting back in June 2015 with JM when he made a couple of interesting points which are relevant today. We were discussing the share price and corresponding Market Cap which he found frustrating but stated that "Time will show that the excellent fundamentals in place will reward all those currently involve"
It was also at this point that they were initiating discussions with a number of banks in respect of funding requirements (these were initiated by board member Allan Walker who gets very little press but has a very serious CV) and JM reported a number of extremely positive outcomes with a specific mention of Societe Generale who he considered would almost certainly become a lead lender. This of course has recent proved to be the case.
He also stated that once any form of funding was near completion he was adamant that the share price should be at the very least the equivilant of 10 cents per pound of nickel in the ground which equates to a 16p + Share price. Remember at this time it is only Araguaia, Vermelho only acquired in 2018 and HZM now own a mining district not just a mine.
It was at this time when China had just announced a $50 Billion investment program into Brazil which we discussed as a positive boost to the then depressed Brazilian economy and JM suggested that as China is the biggest market for nickel he could see a potential direct involvement between Chinese investment and HZM. Had not given it much thought since but interesting now as there is usually substance even to off the cuff comments by JM.
As I say it was over 5years ago now and the company is very different and has been guided exceptionally well since then.
It is worth mentioning and should be confirmed by others who have attended AGM’s over the years that JM has mentioned on a few occasions that he would advocate a special dividend once they were up and running as an investor reward. How when and how much are obviously indeterminable at present but nice thought should or maybe when we get to that stage.
He is also a thoroughly decent bloke. I had an hour long discussion with him at hzm agm back in 2017 he was incredibly upbeat about Horizonte pointing out that there were no other up and coming nickel producers in the pipeline and because he predicted the rise in nickel prices over the next decade (without the foresight of ev’s) . Therefore for him he saw a clear blue sky horizon with a massive future for the company. He was genuinely excited about its prospects and felt it was the best opportunity he had come across in his working life.
Quite some endorsement from a man with his track record.
As a result I doubled my holding back then and have continued to buy at every opportunity.
If you look at the BoD it is pretty star studded with a very high success rate at bringing added value wherever they have been involved across a range of companies.
This may well be the top performer for all of them which would be fantastic for all on board but particularly those who have been invested for some time.
Very odd trading since 9.48 this morning it has been flatlined no adjustments in pricing by mms.
Quite happy to keep picking up a few more to completely overfill my boots at this price with a derisked share with an amazing future.
Never thought I would thank the market makers for anything but bizarrely today I am grateful that they let me buy so cheaply.
You are spot on with your thoughts North there are no issues with financing other than how the financiers split the cake,
Because interest rates are so low obviously commercial borrowing of near half a billion is not at 1% over base, but it does mean the cards are held by the borrower and with a major asset as collateral you are the one driving the deal. In hzm’s case the argument will be among the lenders as to who will be the lead. For the lenders it will be viewed as a low risk deal in this market so the bigger the slice the better.
The current situation with nickel as the go to market will only help negotiations.
Having been in here for what seems like decades and accumulated a decent chunk but not posted for a long time just pop in for an informed read occasionally.
I would like to put my pennies worth in 6.4p to be exact even though I would put it much higher by Xmas.
The 60% debt 40% equity has been the aim for a while and is what is being worked towards.
The main debt element will come from the consortium of 7 international banks who are currently putting the deal together, you would normally have a lead bank with the largest percentage and the rest having smaller slices, unfortunately even though this is how such deals generally happen to balance the risk, many hands always make slow work in this scenario. So this will probably not be forthcoming before April 2021 but probably before July 2021.
However, a Royalty Agreement is nearing completion and should be complete and signed off probably in the next 3 months.
This may be with Anglo Pacific as they are one of the few companies that operate in the base metal space, the majority fight over the Gold & Silver producers. Plus there is a historical relationship between AP & HZM they signed a 6 yr option in 2010 for which they paid $500,000. This has since lapsed but it was $12.5 mill for 1.5% of revenues once production had started.
Things have moved on hugely since 2010 so it will be interesting to see what sort of deal has been struck.
This will not be an option,(whoever it is through) it will be a straight agreement with immediate upfront cash as Araguaia is construction ready and already employing project managers and hiring a construction team. So the cash will be used to commence construction work as soon as it is received rather than wait for the completion of the total finance package.
As mentioned by Luke2, JM has stated that although there are a number of offtakes on the table they will not be signing any until the full financing is near completion, possibly as the healthy nickel price makes negotiations easier but more likely that they simply want to present a complete package rather than a piecemeal one particularly as the final stages are within touching distance.
Before that of course we will finally get the Vermelho study probably first week in Sept.
For those, including me who have been on board this ship for a few years its great to see that its all coming together and due rewards will be forthcoming. GLA