My musings - SD to SB - FMV Try Again4 Mar 2022 12:50
I posted this on Telegram earlier.
I might be stating the bleeding obvious, but here goes .....
Purely conjecture on my part, but I find the timing and dates used in latest GGP MRE update interesting.
Newcrest announced their intention to persue the potential take up of the additional 5% at FMV. None of us know the details of the agreement, and potential cut-off dates to be used when calculating the FMV. My expectation would be that a date would be set to put a line in the sand as to the data be used to calculate the FMV. I would expect this to be the date on notification by NCM of the wish to proceed with the take up of this option (i.e. mid December 2021).
Given that the Valmin code suggests multiple different valuations will be used to value the JV for each of the different resource types (i.e.
$x per Oz indicated
$y per OZ inferred
$z per OZ probable reserve
$w for potential future resource growth
One could rightly assume that NCM came in to the negotiations armed with MRE1 and stated this is the known resource to be used for calculation of the FMV (given that they were the latest available figures to be readily available).
If NCM's valuation is based upon the above (MRE1) for indicated / inferred etc. By producing MRE2 (cleverly backdated to prior to take up of the 5% option), SD has automatically refuted NCM's valuation by stating that the known figures that could be used, should be based on GGP's MRE2 not MRE1 (as it includes data prior to the take up of the 5% option).
In my opinion SD by his actions, has said to NCM, we understand how you have come to your valuation for FMV, but you were using the wrong figures. Go back, recalculate your numbers and come back with a new offer for the FMV using our MRE2.
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