The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
.... as they that cannot see.
The MENU of this company is being laid out for all to see. Starter - Main Course - Dessert.
We are invited into the kitchens to view the preparation of our feast.
But investors seem unimpressed by what is on offer - even at bargain prices.
But in due course the JORC resources will be announced - equivalent to Michelin stars.
And then, of course, the investors will flock to the company, but they will be paying a higher price for the privilege.
PopeUrban: But when institutions are approached regarding a potential placing they do, effectively, become insiders. And in the main they bid the price down & then the company crows about a "significantly oversubscribed" placing & so [a] the price falls upon the announcement & [b] some placees rush to flip the shares & so the price falls again. Then, before you know where you are the market is awash with shares & there is an overhang & all confidence melts away.
So, why not court a cornerstone investor. This investor is offered a significant chunk of shares at a price that meets the company's valuation of its assets at that point in time.
Just for the sale of argument let us say that we need to raise £80 million in equity. Lets say that the company & the investor have agreed a investment of £20m at a price of 10p per share = 200 million shares. Then institutions are approached at the same price for the balance £60m BUT with full clawback under an Open Offer, ie the institutions only get the number of these shares not taken up by existing shareholders.
So the cornerstone investor, who is prepared to commit up front sets the reference point for the fundraise & the existing holders effectively have pre-emption over the balance of the raise with the institutions taking up the balance.
What is holding back the share price at present is [a] PI's being afraid that they will be diluted via a cut price institutional placing with a derisory "crumbs from the table" open offer while [b] institutions not investing because history tells them that they get in cheaper by waiting for the cut-price final funding without taking any of the early years risk that PI's take.
If the company and its advisors are sufficiently confident of the value of its assets & the vallue to be accrued in the future then they will play this very strong hand of cards appropriately.
I think that if the company were to announce that so far the equity raise element of the financing is concerned that there would be [1] a cornerstone investor & [2] an open offer on the same terms which would preserve in full pre-emption rights then tis would remove a whole area of uncertainty and, in consequence, be very positive for the SP.
In other words a "win-win" situation.
Any chance of anyone posting messages about AFC here ?
Completion of the various elements of the overall deal expected before the Christmas / New Year period.
Excellent news. All of the latent value in ARS can now to be released.
A copper supercycle promises to be the icing on the cake.
An RNS on Labola today - and very informative & encouraging it is - but no comment to date on the Bhukia court process.
That indicated to me that detailed discussions & negotiations are taking place behind the scenes. MB has a reputation as a facilitator & an untangler of knotty problems.
I have the hope & expectation that he will secure a favourable & legally watertight outcome for Panthera.
hinkais: I think that Anglo Saxony Mining is billed to be a polymatallic mine. Baker Steel are invested here & they are no mugs. This will happen & nobody can call it an unsafe jurisdiction. Only a minor part of Panthera's value at the moment but, as the saying goes, "Big oaks from little acorns grow"
PI's have done a lot of very good research on the Bhukia court process.
But where is the RNS. The board will be well aware that it is speculation on Bhukia that has driven the SP materially higher & now the reaction so we should have an RNS. Let the BOD tell us the facts as they see them.
Unless, that is, there are further discussions or negotiations taking place behind the scenes.
This company & its visionary & very capable CEO find themselves in the right place at the right time.
Potentially very significant share price gains ahead.
Looks to me as if the serious money is now moving into ARS. Point being that they will be aware that there will not be an entry point here via a cosy discounted placing.
All we need is for the deal to be signed off & then PI's will be secure in the knowledge that they own a chunk of a well financed mining company poised to ride a copper super-cycle.
PI's in Sosander seem very hard to please. An announcement that is full of positives & the SP is down.
But Sosander is approaching "Escape Velocity" & achievement of this should be very positive for the shares.
sorry - Should read "wide range of quality projects ...."
So, i check on this and think; "Wow, its risen a lot". Then i look at the market cap and see that it is still only £14m.
Conclusion: If Panthera delivers on the promise that its wide range of quality implies then there is a lot further to go.
Time will tell but "so far, so good".
In October 3,339,806 shares were issued to contractors at 5.15p in satisfaction of their services.
I think it is a reasonable assumption that these have/will be sold into the market.
This is an inevitable trade-off for PI's. If contractors will accept shares at the prevailing price then it is clearly more advantageous to the company & by extension PI's than raising funds via a discounted placing with costs attached.
Hopefully upcoming news will drive the share price usefully higher so that transactions such as this are at a higher SP = lower dilution to existing PI's.
Per the most recent Align Research note there were warrants outstanding to potentially raise £2m at exercise prices of 4p - 6p & 8p.
The raising to purchase the project was 333,333,329 @ 6p with warrants attached on a 1:2 basis exercisable at 8p = 16.666m raising potentially £1.333.
Also, since the Align Research note £70K has been raised by exercise of the 4p warrants.
So, leaving aside the 8p warrants some £600K only remains to be raised from the 4p & 6p warrants.
So i don't think that there is too much for PI's to worry about here.
Sorry but MMs do not simply match buyers & sellers. That is a restricted market, known as "matched bargains". Yes, they will aim to keep a balanced book for their own protection but they are there to make a market. That is their function. So, if an institution or large holder, way outside normal market size wishes to sell their holding then a price will be quoted but outside the prevailing bid/offer spread. This can create a stock overhang which may take a while to clear. It happens quite frequently.
Clearing out an old pile of papers and came across an FT for Sat 29 September 2012.
REA: Price £5.01 Year High: £7.35 - Low: £4.28
This has no relevance other than to show [a] Where it has been before & [b[ Where, with a fair wind, it could go to again.
Question: Is this excellent news ?
Answer: Yes, it is
The jury is the drill bit. This isn't like taking your Black & Decker to drill a couple of holes to put that kitchen shelf up. It isn't instantaneous - it takes a bit of time.
BUT: If the jury comes back with a verdict of a considerable copper resource then i am afraid that the Judge will be sentencing all PI's to massive %age share gains.
All that is required for a share to go up is for there to be more buyers than sellers.
Holders will be reluctant to sell or try to trade, even if they feel that the shares are currently up with events. They will have seen how sellers of ITM & Ceres now curse themselves.
Conversely green money needs to find a home & some will find that home in AFC.
So my advice (to myself) is to sit tight & enjoy the ride.
C