Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
If a company raises cash via placing at price X, then the share price in the secondary market will converge on that price until the placing has been completed. It is normal that the SP would therefore settle around 6.5p until the placing clears, after which we should move up again.
Raising £1.5m by way of a placing with WH Ireland as broker, at 6.5p. This is significant as it is the first placing conducted via a broker of this size, with access to "real" UK institutional investors. WHI have a good story to tell and the process of telling it will create new, deep-pocketed buyers, who will have follow-on demand. The placing is at a very attractive price relative to where we started the year, namely 3.8p. Think about that for a second. In less than 3 months we have gone from a retail-dominated shareholder register with no UK institutions and a SP of 3.8p, to an institutional placing at a 70% higher price. In less than 12 weeks!
The acquisition of the asset in Botswana is an all-paper deal. So in addition to selling a block of shares to raise £1.5m, management have also created a block buyer of £1.2m, in exchange for a new asset. That is a big vote of confidence.
I see all of this in the context of negotiations with Anglo that could, in theory, run until July. There are always many twists and turns. Every negotiation involves two sides working out where the pinch points are on each side. With this RNS our management have demonstrated that they can raise institutional money at an attractive price, and that they can also now acquire assets for paper. This is very significant and can only strengthen our hand in said negotiations.
Both of these events - the placing and the acquisition - will have involved educated individuals having a serious look at the state of negotiations with Anglo. From my perspective this RNS is therefore validation on multiple levels.
No that's it I think. But the point I was making is the bid/offer is usually quite wide on ARCM. So right now for example you would prefer to transfer at the bid of 7.40 rather than the mid of 7.55, which is what the broker might otherwise default to. Transferring at the bid minimises the CGT liability you leave behind in your regular account and maximises the number of shares moved into your ISA.
M-T the accuracy of the definition is clear. The notion is simple and Wikipedia provides a perfectly good summary.
You can thank me later for educating you.
Gallmat your application for the role of Grand Arbiter of ARCM Debate is acknowledged with thanks. Unfortunately, on this occasion, we have heard from many impressive candidates and your application has been unsuccessful. We will however keep your record on file in case a suitable vacancy does become available at a future date.
I guess maybe not so tired after all. F-29's summary is good. What you're suggesting M-T is analogous to the Guinness/Distillers train wreck. Take a look at what happened to Ernest Saunders and the other key figures involved, then run an upside/downside analysis on whether your notion would be a good idea for Anglo.
This is the definition of Market Abuse, per the UK Market Abuse Regulation:
https://en.wikipedia.org/wiki/Market_abuse
Read the definition and reflect. Time to stop doubling down.
Yep. Always best to check your facts before making big assertions, and if you're on shaky ground in terms of your own knowledge, it's better to fold graciously rather than double down.
Less tiring and less expensive that way.
It is illegal to manipulate the share price of a listed company. It's called Market Abuse. You are wrong and I am right. Even if it were not illegal (which it is), the notion that Anglo or their advisers would engage in such activity is preposterous.
It is also illegal to trade whilst in possession of material, non-public, price-sensitive information. This applies to both purchases and sales, contrary to your assertion.
Ultimately we are both on the same side here and hoping for a successful outcome. I wish you well but am not about to agree to disagree with someone who is patently talking out of his orifice. Sorry mate.
Tom manipulating the SP in order to strengthen their negotiating position would, in fact, be illegal.
It's called market abuse these days and has been illegal for decades. The Guinness scandal, in the 1980s, is probably the best known example. It's not happening here because neither Anglo nor their advisers are idiots.
Monitoring the SP - yes, of course they are. But it won't be a key driver in what happens.
You're barking up the wrong tree there Major Tom. What you're describing is illegal and is not happening.
The SP isn't going up more because volumes are low. You're either a happy holder waiting for the event or you're a short-term retail trader, dependent on the largesse of individuals more liquid or less nervous to take you out of your position. This is still too small for institutions to get involved and hasn't really hit the mass-retail radar, for which something like an article in IC would be necessary. Ultimately, value for shareholders will be driven by management, with Rothschild's help. The SP will not be a significant part of those discussions, unless it overshoots, which currently seems unlikely.
Agree with you Longfell but by the same token why would the option surrender make any difference to a JV? The most plausible explanation to me is that the option surrender was in the context of a new management incentive proposal put to them by Anglo, perhaps new options in Anglo itself. That then begs the question of why now and why not as part of the overall deal.
I do think the "smart money" believes a JV is a better route to value than a t/o. More risk, for sure, but much better long-term upside. The issue with a t/o is that today's stupidly low share price always becomes some sort of a reference point in negotiations, no matter how minor. I am struggling to reconcile the cancellation of management options with anything other than a full t/o though. The presence of dilutive equity instruments at the Topco is completely irrelevant to a JV partner. I read the robust rebuttals to this argument yesterday with interest, but unfortunately "it's perfectly clear" doesn't really leave me feeling much wiser. When all is said is done, many things here are unknowable. We have top-tier advisers on board and Anglo have not spent the past 9 months kicking the tyres. I'm convinced that we will get to some sort of deal and that it will be very accretive to shareholders. What's arguably more important with any event-driven trade like this is that the downside from 8p is pretty limited. Somebody else will want these assets, even if agreement cannot be reached with Anglo.