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They have no need of immediate funding. The major capex will most likely be done via some form of project level senior debt facility much like Jeremy Martin did over at Horizonte minerals where he was instrumental in securing $325 million debt facility.
Securing the ownership of the full project at a hugely cheap price e like this s shows the quality of the leadership team at zinnwald.
Nex t major piece of news would be he capex debt facility. I have no doubt that the guys have already made inroads here (just my opinion btw). They have a great history for just quietly getting on with delivering behind the scenes, without worrying about PR too much - it takes care of itself once they are ready to announce a deal is done..
This really is fantastic. News for the company, and the shareholders alike
L
I’m not too worried about secker. Anton and Jeremy Martin I shrewd guys. Also, you still have signficant shareholders like Dave hall from Eris days who got in at 25p a share. Even osisko was in at thT price when eris first formed
Then you have the likes of Henry maxey who is in from 5p. I doubt he is just going to settle for a 3 fold return on his money in a potentially highly lucrative sector like lithium when in a few short years as the project develops the mkt cap could be multiples of its present level.
Also given that the creditors of solar world have agreed to lock-in periods, I’d hazard a guess that they are not just going to sell out at 15/16p level given their shares have been issued at an effective 12.5p price....
I’m reasonably confident that there would be enough sig shareholders to block any cheap bid coming in.
I think you will see more moves from the board to add to the value proposition to make any bid around the 15/16p mark (highest traded price in last 12 months) appear ridiculously paltry.
L.
People don’t get how good a deal this is.
I’ve long said that they should look to pay somewhere between around €4 million to €30 million, which was basically the net amount paid for the 50% at the rto, and the value of the option agreement that bacanora had with solar world, before it collapsed in feb 2020.
€8.8 million euros though is awesome. Also, €7.3 million euros over 50 million shares means the shares are in effect offered at 12.5p per share, so dilution is essentially minimal (Ie they’re not being offered at a discount), and of course half of them are locked in for up to 6 months....
This is a stonkingly good deal
L.
I think there will likely be a spike in the near future. Either for the reasons Malik mentions, or because zinnwald will have to do some form of capital raise to fund the purchase of the other 50% from the solar world administrators.
Remember that zinnwald had around at best £5 million in hand from last November, which won’t be enough to buy the other half interest.
I put the price tag for that in the range of €4 to €30 million euros. So for zinnwald to acquire it, is almost certainly going to involve a placing of some sort. I doubt they’ll want to take on debt via a convertible loan.
Price range is based on; low figure is the net consideration bacanora received for the 50% zinnwald now own, and the upper figure based on the lapsed (jan 20) option agreement bacanora had with solar world to acquire the other 50%.
Administrators may be holding out for as long as possible while the lithium market appreciates in value, but I’m guessing they would also want the most liquid currency ( Ie cash as opposed to shares) which may work to zinnwald’s advantage. The administrators will have to conclude a sale of the asset sooner rather than later, rather than having it sit on their books ad Infinitum...
I also think it would be in zinnwald’s interests to reach an agreement soon, to help protect themselves from a low ball bid offer, which only has to be around 15/16p mark, and would be difficult to counter, especially if it was made by ganfeng in the first place (This price being the highest close in the past 12 months)
I think thouh we’ll likely hear something in the next month or so. Price is gradually moving upwards, and volume of trades is starting to trickle up too...
L
Mike, No date yet, but had this response from Aiden on Friday, which sounds encouraging that we may not be that far off...“”We have completed a 6 hole scout drill program. The better samples from holes 1-3 are at the lab so we expect assays in 2-3 weeks and will probably put out an update soon after while we also plan a technical review with Richard Sillitoe (a renowned geologist) later in the month with assays in hand.We are very pleased with the textures and veins in the core, hole 3 hit a major altered and veined fault with significant width so it shows that there are major structures there and that one was high on the hill well above the best boulders. The textures also indicate shallow level mineralisation so the target is likely a little deeper on these structures. The assays will determine our next steps but we still anticipate starting the listing process assuming they are positive and we are investigating a few other opportunities too which could add value. The gold price is strong so that should really help us with marketing when the time comes. RegardsAiden“”L
I can see zinnwald being worth north of. £1 a share eventually, given the way lithium prices are moving, and the nature and stage of the project. Plus there are other exploration assets to potentially find, and who knows they may even look to buy interests in other projects....
But I think there is a good chance we’ll get bought out at a lower price well before then now that the Chinese have a 44% interest. They may not have a strategic desire for European assets, but it would be an easy one to pick up for a relatively low ball offer. Price really needs to break its 15/16p ceiling before an offer is announced though.
If they did make a low ball offer, I would certainly vote against it, but 44% would be a hard vote to beat.....
I do worry us investors will get shortchanged on the real value of zinnwald before it’s had a chance to be properly realised...
You have to hand it to China, it’s a very smart move they’ve done here. I wonder if they were aware of bacanora hiving off zinnwald - their discussions had been ongoing for about 8 months apparently... zinnwald lithium has only been around for 6 months.... so they must have been talking to ganfeng and Erris at the same time....
L.
Hmm, doubt it.
Zinnwald guys know the real value of the project. Not sure they’d recommend any takeover offer from EMH. the Erris guys know the zinnwald tech team/mgt from long time back. Cant see them taking on this project, only to then sell out to the first bidder, especially when there is no obvious sign of progress yet.
I think Anton and his team have bigger ambitions... too many opportunities to get involved in over there just to sell out quickly...
Henry maxey wouldnt I think have put his money into the company just to see it bought out before it’s developed the zinnwald project...
L.
Despite deeply discounted placing, guess price rise is because many people buying in to make sure vote goes a specific way at the gm. Assuming that means ensuring the placing goes ahead?
People must be banking on the pedigree of the guys coming in, which makes sense I guess. Why would the get involved if they didn’t have a vision for growth/strategic direction for the company?
I imagine if the placing is voted in, there will be a sharp drop in price. I shall look back in then
Oh well, made a small profit.. onto the next opportunity.
L.
Be interesting to see if 20p becomes a new resistance level or not.
I’m now looking for somewhere between 10-15p re-entry point now...
I remember this happening post Sprott taking up his investment in the company a few years back.
Dropped heavily below his entry point, and stayed there for well over a year....
Don’t get me wrong, happen to still think Mtr is a pretty solid and well run company, but I’m hoping this will provide a great opportunity to get a big holding very cheaply
L.
Thanks for that.
Well, despite the fact starknight that you basically seem to be an abusive and rude individual (based on at least one of your recent posts in the last hour), at least you have some semblance of a sense of humour, even if you don’t appear to have much of any kind of value to add here...
I’m just debating whether it’s worth the money to become a premium member so I can filter the dross you’re spouting, or whether I can live with enduring it any longer....
L.
Given that the FDA have allowed use of the drug in this very specific circumstance, and that the expected duration for it is 6 months, does this mean that FDA approval would now have to wait for the outcome of this 6 month period to be analysed? Or could the FDA approve the use of the drug before then?
(And if this is a stupid question, fair enough)
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“Investing in BRH” - haha like it.
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Cloudy,
You need to re-read that market announcement very very thoroughly. The word “approval” is not even mentioned once in the document.
In fact it has been very carefully worded to say the FDA has allowed the use of the drug in a very specific circumstance.
It is NOT FDA APPROVAL....
L