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Vauch, I went through a warrants farce on PMO a few years back. Any time the market price was above the warrant strike price - typically a certain percentage above it - there would be immense selling pressure all the way back down to the strike price.
The way I see it, the warrant holders don't convert to shares to hold - that increases their exposure and subsequently their risk profile. Instead, when the market price is over the strike price by their desired percentage, they'll open a short position and convert the warrants to cover the short. It's a no-risk play.
I was blessed with the knowledge to predict exactly what would happen on Friday afternoon and Monday morning: resistance at 1.75 and 2.25 (10% and 50% profit for the warrant holders).
Sadly, I wasn't blessed with the wisdom to remember my own predictions in the heat of the moment and act accordingly.
Do you guys not feel the slightest bit disingenuous posting when there have been large buys, and completely ignoring the equally large sells?
Sure, we had 2x100k buys. But earlier in the day, we had 2x100k sells.
We also had a 450k buy earlier, and a matching 450k reported after the bell.
Thanks for copying it over here for convenience.
Eyeguy, if your theory is correct then we're in for the mother of all squeezes next week. But I'm still not convinced that a large proportion of those placing shares were forward sold.
Partly, because of the (relatively) low volume on the 17th - even if large trades are reported late.
But also because of price action on the 17th. The price stated above the placing price all the way to suspension. If they were selling the shares, it had to go somewhere - either to an opposing buy trade, or in to the broker's pot. Again, the reported volume for the day was too low for a huge number of matched buys. And as for the latter option - going into the broker's pot - the price stayed too high for that to make sense either, it would have fallen through the placing price with that much selling pressure and no matched buys.
There's a podcast link further down below from earlier this week. In it, LC states that they want to narrow it down to their preferred few partners before they pick one. It won't be a done deal this month, but there's a chance of it next month.
"following discussion with the Company's broker regarding the status of the Placing, the Placing has now been terminated in accordance with the terms of the placing agreement between the Company and TPI"
Key phrase: "in accordance with the terms"
Whether it was cancelled by TOM, TPI, or both in mutual agreement is utterly irrelevant.
What matters is that TOM has absolutely no liability in this.
MC, your earlier question about whether TPI could sue TOM or not - no they can't. Cancelling the placing was in accordance with the terms.
Last half hour of the week.
200% up on the day.
Resistance levels well and truly smashed.
A probable squeeze in play.
JV agreed and signed with a strong partner.
Clear and visible path to revenue.
As Doctor Strange would say, "we're in the endgame now"
I think I must be allergic to holding cash. Sold out of another company, and topped up here 5 minutes later. Couldn't be bothered to look for a new opportunity, and I figured these are going cheap at the moment so I'll bring my average down to 2.5.
Have to say... my initial entry was punt money here, but now I'm into conviction play territory. Fingers crossed.
Degsy, prove your numbers.
There were 325m placing shares.
On Wednesday 17, between the announcement in the morning and the suspension in the afternoon, 42m shares in total volume were traded.
How tf can you, or anyone else who has stated it, claim that 350m shares were forward sold?
Dust, what are you using for the basis of that interpretation? Genuine question, because I can't see anything to rationalise it.
The tech being proven requires upgrades to the POSP so they can get it up to 500bopd.
Those upgrades cost money.
Where is that money going to come from?
There has been nothing to suggest that Valkor will actually fund the front end of the cost to get it there. After all, the original RNS said something like £300k of that £1.5m was going towards the work that Valkor would do for the upgrades. Unless Valkor has decided to take that on the chin, TOM's still going to have to pay for it.
" Valkor and TomCo will review and seek to agree, inter alia, the budget for the proposed upgrades to the POSP and phasing of the associated tests pursuant to the JV Agreement, before TomCo commits to any material expenditure"
To me, that says Tom will still commit to spending the money for the upgrades, but not until they've agreed the budgets in finer details.
If there's anything you have to support your case that TOM won't have to pay for the upgrades until after the tech has been proven, please share it. I'll be the first in line for the party if that's the case.
As much as I hope this run continues north of 1.5p, a re-read of the RNS does bring some cold water.
I read the below sections to say the following:
TOM will put up the money, just not yet - only when they have the funds available. First they will review the budget and timeline, figure out how much cash they need, then TOM will commit to spending some money. I expect that point, there will be a placing... unless we can get the price to stay over 1.5p, which would bring 70m warrants into play - that would be a load of cash for TOM which could go to Greenfield.
Also, they have 360k cash which is enough just to keep the company running through to December. That tells me that if the warrants don't come into play, then there absolutely will be a placing by December to raise cash just to keep the company running - not taking into account any expenditure related to Greenfield.
Right now, I'm in a profit. And I'm undecided whether to hold on and hope, or take my money and run / hope for a lower re-entry.
RNS sections below:
Further, the Company will no longer be required to provide funding to Greenfield of up to US$1.5 million, as was previously envisaged, until such time as TomCo has such funds available. Accordingly, Valkor and TomCo will review and seek to agree, inter alia, the budget for the proposed upgrades to the POSP and phasing of the associated tests pursuant to the JV Agreement, before TomCo commits to any material expenditure. The Company will provide further updates to shareholders in this regard, as appropriate. All other material terms of the JV Agreement remain the same.
As at 18 June 2020, the Company had available cash resources of approximately £360,000, which, prior to the cost of any works to be undertaken under the JV Agreement and associated upgrades to the POSP which are yet to be agreed, the Board believes is sufficient through to the end of 2020.