Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Big fish already own 80% and are likely inside on information.
Which may be why they are not buying more even if they thought it was cheap.
We Await the details of the settlement ….
And then completion of the sale….
Completion of sale timing will probably line up with the release of accounts.
… 8 weeks left in Q2
I don’t see it happening at all, unless
Scenario 1 : the remaining book is somehow sold for enough to clear the debts and leave a surplus,
or scenario 2, they wind down a subsidiary that holds a large chunk the debt and liabilities, deciding to not bail it out with funds from the PLC holding company, but instead wind down the plc distributing cash to shareholders.
Stranger things have happened.
Don’t overthink it :)
A special dividend is one that’s paid as a one off, which is fairly common following an irregular / one off disposal of assets that nets cash profits.
Where as a normal dividend is paid from cash flow regularly / once twice a year
Eg seed last week, they got surplus cash in from an asset sale, handed out a dividend, it was a one off, not a regular repeating dividend, it was a “special dividend”
Not had any reply to my emails from last week yet.
Would make sense as the only way to move money equally to the 80% of II who may or may not decide whether to fund an ongoing business or not with said proceeds.
Waiting for next company update.
$300m nav originally quoted at $170m net available proceeds
If only $65m net available proceeds, and ignoring millions that will likely be used to pay debt down, $300m - $105m = £150m NAV.
£150m nav available to write down some asset values.
Plus $30m JV sale which we were told made the JV transaction profitable from the original $7m invested.
Let’s see the numbers, and why the majority of holders have held from £1-2,
2p is par value, any refinance below requires a restructuring, any raise requires shareholder vote.
It’s going to be tight no doubt, lots of the remaining net asset value will be tied up in collateral which will be secured against the debt, and will be released over time to pay down said debts.
the plan was to use 50m of the asset sale proceeds as working capital, this is in addition to the net available cash proceeds of $65-110m.
Again at 5-7% interest plus libour - 10-12% debt, the company will be better off paying down as much debt as possible, or atleast hedge these costs by depositing the cash in short term government bills at 5+% which would give them access to the capital if required leaving the 6% interest difference as a fee for this ability, which is cheap compared to tapping the market again at later date.
Just a matter of balancing the books as well as possible, and potentially selling the remaining book if an opportunistic sale comes which would leave the deleveraged company running off its fee based model, and that’s where the actual time and work will be needed, they will have to earn their living, not rely on deposits.
And good luck as a private company.
Pretty amazing movement, £1.30 to 68p lows and back to £1 nearly
That’s the important bit “Its virtually insolvent” and it’s priced as this currently.
aslong as is still solvent then there is equity for shareholders, if they keep the company going I do expect a restructuring and open offer to fund going forward securely and let’s face it 5-6% + libor is not cost effective debt to have on any book, when you can raise equity and return that interest to shareholders instead.
The defence will be something like :
“we publish an RNS with the Nav of our assets daily which is currently 49p, we do not control market pricing, market pricing is a complicated matter and the market may at times over or under value a company based on market speculation at the time”
I tried outlaying a scenario on Twitter, with a picture of prior numbers the company gave, under company # last night, if you see it you may kinda get what I’m thinking.
$105m doesn’t just vanish, $15m more on top of the $15 allocated originally for closing costs maybe, but of extra interest maybe, but not $105m.
Unfortunately, oh yes it is,
"JEMA has been named as a defendant to civil proceedings being brought by VTB in the Russian courts which were commenced on 17 April. The claim has been brought against certain J.P. Morgan entities and relates to $439m held in a correspondent banking account with JPMCB (NY Branch) which has been blocked due to sanctions. We are not aware of any nexus between JEMA and amounts owing to VTB. "
i like how the company puts "The funds in the Company's 'S' Account have no value in the Company's accounts because the sum of £19.3m in the 'S' Account " when the value of the actual stock held in Russia IS in excess of $200m-$250m at market prices.
Pure speculation and Impossible to tell without the current numbers, but I’ve been Looking again and again at old estimates given and numbers in rns since, I’m thinking they might end up something like this:
with $150m debt ( RQ pay $50m more off from original $200m quoted estimates)
rq left with $50m cash for working capital
and around $200m nav left,
Maybe the wiggle room lenders have given is another $50m.
This way the company has around that 150% assets to debt. Once adding on the other sales.
If numbers are worse then it’s a sale of assets or recapitalisation to fund an ongoing business, maybe by open offer and that’s why the large existing holder have not sold.
I just want to see the real numbers going forward so everyone knows where they actually stand.
Because no one really knows the actual financial position of the company until all sales are completed, and much of the residual value left will be held as security / collateral for up to 5 years.
And we still don’t know what the company will actually do once the currently announced sales finalise,
will the sell off the remaining reserves (if so at a profit or loss?)
Or Will they choose to run the business with the remaining reserves under management and if so what would the numbers of that company look like?
TLDR no one knows where we stand till it’s done.