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But they get 100%, why share the profits?

Additionally they will be able to raise the remaining funds at a far cheaper rate than SXX.

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Less risky if they are just an equity holder.

The equity infusion will mean SXX will be able to raise money, when required in two years, on normal commercial terms, particularly if a company such as AAL is a significant holder - that was the whole point of the SR, to look for an investor that could improve the profile of the company

They are not paying £400m

They are also taking on ALL liabilities, including bonds and Gina’s fixed and floating charges.

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Which is why I maintain 600M for 75 % of the company, leaving the liabilities with the company (and being able to derisk very quickly after the inevitable rise in the price) is a better deal for AAL and a better deal for sholders. Keeps their investment liquid this way

100% agree

Redbull,
I agree with you. My figures (and yours) are a worst case scenario raise/dilution. Add some bonds and it gets better. But even under our scenario everybody can salvage their investment if they're patient. By selling the whole company our losses are crystallized witout a say in the matter AND we lose the upside that will come at production.

I find it hard to believe there could be/have been a successful raise at 3.5p, which makes me suspect we've been stitched up by Fraser, who thinks he can line his pocket better still with AAL bonuses and incentives.

Digusting/disgusted

Buried in Pterois' musings is a point I've made before. It can apply to any of our current IIs, wealth funds or indeed AAL..
Why wouldn't someone with deep enough pockets fund the $680M that's required to get us through the next two years of construction (the point at which the progress ought to make the rest of the funding available on normal commercial terms)?

Even if they issued the shares at 3-odd pence (as the BOD would spin it - a 50% reduction on the current price), say 20BN shares @3.4p that would equate to a 75% stake. That act alone (raising the funds) ought to double the share price (to 7p plus), at which point the funder could sell half their stake and be in for one third of the company at zero cost.

We would be diluted by 75% but at 13mta production (7-8 years from now) the company ought to be worth around $13Bn, meaning a share price around 50c or 38-40p. At that price almost every current holder would be in the money, the funder would have either 75% of 13bn (almost 10 billion for a 680M investment) or 33% of 13bn (4-odd billion on a free ride)

Everybody wins.

I think that's a better deal, even for AAL, than buying the whole company and taking on all the work. They, or another, could have a passive investment here that they could derisk very quickly after funding, then sit back, let SXX do all the work and cash in when the mine is in production.

I thought that's how it would pan out worst case scenario (best case was getting the funding away first time around) and that's what we were led to believe was happening with the SR (but all the time there were covert visits to WS and discussions behind closed doors).

We've been had by Fraser.

Surely after this debacle, if the company is stolen by AAL, Fraser cant expect to stay on in the area and run the company, even if AAL want him to.
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Doesn't he earn £900k a year? That would insulate you from a lot of local noise.

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i think he'd need to spend most of that on security.

It wouldn't take 10 years. Might take 5, but we were looking at 5-8 years to see meaningful production and a return on investment, so what's the difference - and there's a chance that there could be a settlement sooner (if there's a smoking gun).

Surely after this debacle, if the company is stolen by AAL, Fraser cant expect to stay on in the area and run the company, even if AAL want him to.

Scotman
Thanks for your honest assessment. It certainly looks like the BOD are skewing this in favour of AAL and are not being fully transparent regarding other interest. The fact that AAL have promised to preserve their jobs and bonuses has got to be a conflict.
One further question for you. If the ship goes down, do you think there is an actionable claim? (Personally I think there's enough smoke to get a no win no fee outfit interested)

That's a bit about turn from you Scotman. Interesting. I value your opinion. While very pro the company (and Fraser at times) I've always found your posts to be level headed and even handed (your last being a case in point) Do you think we have a chance of saving the company from the clutches of both AAL and the administrator?

Cracking post Fred. Well said. More questions than answers. WE NEED - AND DESERVE - ANSWERS

RNS makes it clear that AAL have not purchased any shares.....

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IBAB - i think you mean …….RNS makes it clear that AAL have not purchased any shares THEMSELVES.....

This has become very shady. Who's to say they don't have a "friend" hoovering up shares.

Lots of speculation on motives, but it's very clear that the BOD have not played with a completely straight bat and there is a history with AAL going back several months at Woodsmith and several years at Fortescue.

Smells a bit. AAL may end up getting the mine, but they may also end up with a class action suit too for theor troubles. Too many people here have lost too much on the back of a clearly articulated plan that took a 180 degree turn, just before the last penny was spent. The brakes could've been applied much sooner.

the plan should be to raise the funds, through equity, convertible bonds and bonds - the plan that was articulated by Fraser when they updated us on the strategic review - and in the months and years before that. There was NEVER EVER a plan to sell the family silver, and certainly not at a price that had been trashed by fraser (deliberately or otherwise).

NEVER once did the BOD raise the possibility of a sale and they'd still be keeping it quiet and running down the clock if some big wig from the company hadn't blurted it out to a barmaid a couple of weeks ago. There have been lots of leaks (and we've seen clear insider trading on the back of it) but this one might just help because there would be time for a plan B if the AAL offer is rejected. They were holding off on this offer to try and spring it at the last moment when the clock was at 11.59.59. That's disgusting. Fraser and the rest of them need sorting.

local community $1MILLION, not $1 !

Often PI's are passive about voting or don't understand the process. Everyone needs to contact the broker that holds their shares to make sure they understand the process and register their vote in time.

There is value here and there is still time to sort out a plan B, even if the vote is NO. Scrimshaw didn't say administration was inevitable or guaranteed if the offer was rejected, just that it was "likely". It's likely if the BOD keep dismissing and burying alternative proposals such as the "consortium" that hasn't been identified.

The BOD has been bribed with job offers, incentive plans and bonuses by AAL. They're (AAL) also giving the employees $19M as part of this deal and trying to bribe the local community with $1 a year for three years. This is disgusting. The BOD are not acting in the interests of sholders, but themselves. That's a breach of their job.

Are the employees going to make up investor losses> I don't think so. But without the investors there'd be no jobs. feck em all. If the mine is going to be stolen from us, then fill it in I say.

Minor point

But was Cf allowed by the rules to purchase those sahres during these negotiations ???

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Good point ffc and not a minor one. I'm sure he took advice and got clearance, but was the advice kosher. I'm not so sure. It certainly calmed a few frayed nerves, mine included, when all the time the AAL boys were combing over the books and making undercover visits to the site. Stinks as bad as the rest of the BODs actions (and inactions) over the past six months or more.

I just don't see how Fraser can show his face around town with inciting a riot

so why do they have a notifiable interest?

not if they are bringing another party to the dance. were they part of the financial consortium that was blown off by fraser? We don't know because fraser isn't telling us anything about the term sheet they received in dec updated in jan.

you're right they wouldn't want to crash their own shares, but by the same token why would you buy shares above 5.5p (plus dealing costs) if you knew AAL would be taking them back off you in a few weeks for less than you paid for them. that doesn't make sense either

polygon held some shares long, some shares short (net position 50M) and some convertible bonds. They closed their short, sold their binds and are now long almost 7% . Personally I don't think this is an admin play. So why are they building a long position, some of which above the 5.5p mark?

Will be interesting to see tomorrow if they've been adding again today.

I'm not sure Polygon know anything about what Sirius are doing (Sirius have recommended the offer and don't seem to have a plan B - shysters), but Polygon might be cooking up something themselves or know of some other potential interest
Polygon took a massive punt on Quindell/Watchstone after it tanked and they've done incredibly well over there,. these guys don't mind a bit of risk and they're no mugs. Come on Eugene - are you with us!!!

It would be good for Sharesoc to reach out to them and get a clue on their voting intentions - and to track down Mr Perry. Those two is a big chunk to add to the rest of us PI's and could be a game changer. A small 4100-200 raise to keep this ticking over while the debt solution mention in the RNS from Dec/Jan could be a way - our only way - out of the clutches of AAL and the administrator.

Maybe we have a fighting chance, but it'll be self help as we've been abandoned by the BOD. ****s.