Member Info for johnpwh

Maybe they take PIs concern so seriously they noted it twice!

Yep Matthew, the prospect of the bid failing (which the market seems to think it will, with the SP drifting daily since 6th May announcement) resulting in a hostile partner is a concern for me. Yet by the same token I don't think that GF will sabotage things. Just as something really good was happening a massive spanner has been thrown in the works - and cant be 'unthrown'.
I'm not seriously thinking of cashing my chips in just yet Foz, I am a LTH, albeit only since Jan 2020 which qualifies me as a newbie by some here! I'm just currently a confused and disillusioned one - in many years of investing this doesn't seem like anything I have previously encountered. I look forward to the opportunity to oppose this, at least on the terms currently proposed - you can count on that.

Think we all have big questions about this. The market doesn't think its happening . Did GF really think they would win at 67.5p, or is this some sort of ploy that sadly our BOD went along with? I don't know what to do here, sell/ buy/ stay put?

Did you become a member of LSE just to deliver that Bob?

This is just sinking by the day. Beginning to lose confidence

That's great Mick. Have we got 19.2 million shares between us?

xtw
Hi, I agree that the recommendation of the independent directors is likely and have stated so (I think the word I used was implied if you read my post), I was pointing out was that they have not yet actually committed themselves as some seem to think - perhaps they themselves are apprehensive about there being the sort of backlash that we shareholders are expressing on this board. But we are saying much the same thing.
As for GF selling out if the bid fails, as has been suggested, is that really a possibility? Between SLL and BCN they directly or indirectly hold 64.4% of the Sonora asset. Would they back away from what is already a controlling interest? Selling their BCN shares still leaves them with half the Sonora asset via SLL, or is it suggested that they would walk away from that as well? To sell their BCN shares but not SLL would leave them in a far weaker position. They are not investors like M&G, they want the mines product, Sonara is big (huge) and nearer to development than virtually any other large deposit.
I don't know the best way to proceed. I do think that at the least we must all ensure our 'No' votes count if a bid is made

I don't really buy this theory of going slow on Sonora if GF don't get their way. They own 50% of the asset and 28.8% of BCN who own the other 50%. They want the product in a market that is starting to explode, so the party most kicked in the unmentionables if they go on a go slow is themselves.
Scan reading the RNS I cannot see anywhere that says that the Independent directors have agreed or recommended this. The formal offer depends on their recommendation but that is not to say that the decision has yet been made, even if it is implied

Hi Etotheipi
I think M&G now have 13.6% is of the new enlarged shares in issue following the issue of new shares to satisfy GFs enlarged
28.8% holding. But that;s by the by, your numbers show how close it is.
M&G will be well aware of their pivotal role here. I find it hard to believe they wont exploit it to realise a higher price for their investors.

Wow chaps/chapesses some great posts while I was out, which I haven't fully worked through.
Others may have already put this but as jam said there needs to be support of 75% of Scheme Shares. A quick and dirty search of the RNS using CTRL+F shows Scheme shares are shares which don't include Excluded Shares. In turn Excluded shares are those owned by GF or held in BCN Treasury (are there any?).
So, assuming there are none in Treasury, and the above is right, there needs to be:
c.384m x .712 x .25 = c.68.3m of non Ganfeng owned shares voting against to block
if 75% of ALL shares were needed, the number of non Ganfeng owned shares needed voting against to block is :
c.384m x 0.25 = c.96 m
So assuming all my ramblings are correct its a close run thing if M&G say no, since Hanwa surely will
M&G and Hanwa have I think about 17% of the soon to be larger issued shares, so 0.17 x c.384m = c.65.3m

Aaargh,
Nice to have a new contributor. You are obviously well versed in BCN so interested in your views.
Seems we have 2 distinct themes here. Should the BOD have given their backing to the proposed deal since it contributes significantly to the likelihood of success. And how do you explain the current SP.
It is the latter that I cant understand. Such is the discount that you have to conclude the market doesn't believe that this is likely to succeed. In fact its yelling it loud and clear. Yet failure to succeed is likely to lead to an enhanced offer because GF clearly want full control now, I doubt they will be happy with a JV arrangement. That in turn implies a SP should be at or over 67.5p.
Beats me!

Bluegrass
75% is necessary for the bid to succeed (including those GF already holds).
I believe it is illegal for others to accumulate on their behalf, think they used to call it a 'concert party'

Hintza
I'm not sure , but I think (please correct me someone if I'm wrong) I can think of 2 reasons

Firstly GF aren't free to go into the market without clearance from Chinese authorities. From what we have previously seen that takes a couple of months

Second they haven't actually bid yet. But if they take their holding over 29.9% then they have to . So although they could increase slightly from their 28.8% they are very limited

I am keeping my eye open for Hanwa buying. This deal is a disaster for them as GF will surely turn off the taps at the end of the current offtake agreement. If they increase their shareholding they could frustrate the bid?

Well said ZQ33. I posted here a bit, but there was nothing but shouting down of contrarian views, and the board 'owners' acting as an abusive pack. I have seen this on other boards to an extent but nothing like this one - not even close.
I don't normally give up but did in this instance. You cant do much against keyboard warriors.

Indeed Mr C. That is the unfathomable thing. Why are the BOD so enthusiastic to rubber stamp this apparently low ball approach. We are the owners, they are the appointed board running the show for us. So tell us why.
Its only 18 odd months since GF was just a party with whom there was an offtake agreement for our product Now they look like they are going to own the whole bl**dy thing lock stock and barrel.

Good point about ZNWD. I don't know the answer, BCN must have some arrangement absolving them from the requirement to bid, maybe that is transferred in these circumstances? Think that's one for any corporate lawyers here.
See what you mean about the project level stake, but don't forget how little GF are paying for the other 50% or the project. Their £180m buys them the 50% of SLL shares they don't own, 40% of ZNWD (with a MC of £56.4m) and access to the£100m+
in BCNs bank account (admittedly they already indirectly own 28.8% of these items). Less any liabilities of course on BCNs balance sheet. Fraid I'm not feeling motivated enough to quantity all that at the moment more accurately but suffice it to say that it doesn't look bad deal for GF shareholders - i have no gripes with GF, they are a business and seem to be running that business extraordinarily well, they answer to their shareholders not to BCNs. Our gripe is with our BOD, and at least I would like an explanation as to why they think this is a good deal. How about a video with PS talking to Proactive or better still CRUX - he's done that before and I would expect him to face some searching questions. if no such interview appears then we can form our own opinions as to why it is being avoided.
Conclusion: This is a cheeky enough deal to be significantly increased if rejected by BCN Shareholders so lets hope it is.

Depends on the reason that the deal doesn't go through.
If the deal fails due to failing to get the support necessary, 75%, then I can't see it falling back to 45p. That is because the 67.5p valuation by a willing suitor provides perspective on the company worth, added to the message/publicity about this company that has been sent to the wider investing community as a result of the bid. People are aware there is a major company here in a growing green marketplace.
However if the deal falls through because GF decides not to bid then that is a different matter. That would raise questions of why? Did due diligence reveal something previously unknown? The damage of confidence in the company could then cause a fall back to prior levels. I think it unlikely as DD must have been done in detail by GF in pursuing the 28.8% holding.
A failed deal, for whatever reason, has changed Bacanora. We previously had a partner in GF who had not previously tried to move beyond working as part of a JV with its other investments. We would then have a JV partner who is apparently not working in harmony but reluctantly within the current arrangements. Hostile if you like. That worries me a bit.
So we have c.384m shares in issue once the latest GF shares are admitted. Therefore every 1% needed to oppose the deal will require 3, 840,000 shares to be pledged. It will need some effort, even us vocal shareholders on this board who bother to discuss the company may struggle to muster 1 or 2% between them.

Hi Tiger
Surely Hanwa will oppose this with their 3.21% - they want the product and if GF end up with total control I don't imagine they will supply Hanwa after the expiry of the existing 2 year agreement. So if M&G opposes this then between them there is already 17% against. You only need 25.001% to make the bid fail as I understand it. It suddenly looks doable - and maybe that explains the discount - the market doesn't think this will succeed at this price despite GF already holding 28.8%.
At the very least I have convinced myself that an increased offer is possible.

Nope! it was 15.87% when the RNS was announced just after the 45p placing. But as the further investment by GF wasn't certain at the time then the additional shares to be allocated to take them to 28.8% weren't included in the denominator of the calculation.
They hold 52,528,941 shares, as you noted earlier. The 6th May Offer RNS says, in section2, 'On completion, Bacanora will have 384,144,901 shares in issue and Ganfeng will own 28.88% of all Bacanora Shares'.
52,528,941/384,144,901 = 13.674%

hi xtw
I put the calc in the earlier post. M&Gs holding hasn't changed since the 9th Feb RNS by them but the May 6th RNS confirms a new higher shares in issue due the the approval of the increase in GFs BCN holding to 28.8% (which is being achieved by issuing more shares)