Member Info for Montmuzard

"We look forward to providing further updates".

So do we, especially since we're in an even stronger position than the one we were in a few months ago, which was also very, very, very strong.

"To all of the naysayers, take that as a warning..."

It's probably the naysayers naysaying for their 10 pences and a soggy biscuit round at Jub towers that has allowed whoever accumulated that little pile to do so.

It’s based on the fact that the company said it in an RNS

No special divi for the special divs!

So, do we get one monster RNS or do they do it in dribs and drabs? I would prefer the latter: rather than seeing the shorters fried, I’d like them to be slowly boiled alive.

If the company were only selling WK it wouldn’t constitute a sale of substantially all assets under Aim Rule 15. So 4.5p is considerably more fanciful than 75p for the assets that are actually being sold. Still, good try. Next.

I agree with Arsenalles: 75p would seem a little low given how long this has taken, the fact there are many interested parties, and the way PGM prices are going (unless it’s just MT and we get a juicy free carry on top). That said, three things are tempering my expectations a little: the size of UBS’s fees, which must be at least a few tens of millions, maybe more; the way Sterling has strengthened quite substantially against the dollar lately (which is remarkable given British exports and inward investment are collapsing post-Brexit); the amounts of additional shares we still need to consider (I make it about 3.1bn not 2.8bn, but could be wrong); and whatever money the BOD might want to hold back for future development. All of that potentially adds up to around a billion quid’s worth of money on top of whatever MT sells for divided by 2.8bn shares currently issued. So, I’m hopeful for about £1.25 if just MT, a bit more of WK too, £1.50 if the four nearest-to-go Rosgeo assets are chucked in as well. I still have a suspicion they could be selling the whole lot, in which case I would be over the moon with £2, but would rather wait a decade to get two or three times the additional 50p or whatever now. Rums all round!

Are we going to hear a shout from the crow's nest as Treasure Island hovers into view on the horizon tonight?

This looks like it could be the start of a proper rise to me. Totally different trading pattern to just about every single day for the past few months. Have we broken out of being rangebound?

You don’t say “massive dividend” when you are privy to inside information (or discussions about inside information) and you could just have said “dividend”. You also don’t then correct yourself to “large” when you really meant massive, because you’ve made an accidental error. Arguably he didn’t reveal anything that wasn’t in the RNSs, but he knew what he was doing. This was a deliberate hint, designed to get the pulses racing. But whose pulses?

@Mooching: I didn't say it was a pump and dump. Indeed, by definition it cannot be a pump and dump if a large proportion of the share price reflects a special dividend which then vanishes once it is paid out. My point was that the market is quite likely to over-correct on the downside: I'm sure the MMs will have great fun as hundreds of millions of shares are dumped onto the market by PIs heading for the door after the dividend is paid. I agree that the BOD are creating a global player of significance, and it's fairly clear to me that the Rosgeo JV will/should be worth multiples of today's share price on its own. But given it is going to take years to realise that, I can see it taking some time to be reflected in the company's value, regardless of what the BOD do.

@Tigra: I hope I'm wrong. After all, maybe those intending to sell will do so before the dividend is paid to get both their special dividend and any priced-in uplift, meaning transfer of shares into institutional hands, thereby providing greater share price stability on the other side. But if I'm not, I'll be buying as much stock as I can at that point in time!

Mac was right earlier: some absolutely fantastic, thoughtful, insightful, analytical posts on board the galleon today. The green coffins are nowhere to be seen. They've tried half-heartedly, but the know the game is up. Start polishing the cannon!

NB: my last post was responding to SteSte's point, not Tigra's. Although I am sceptical that the market will value EUA properly once the dividend is paid and the herd goes looking for other opportunities. Which is fine by me: like Tigra [two cracking posts by the way] I full intend to stay aboard HMS Eurasia, and I'll definitely be shelling out for better quarters and a couple of extra tots of rum.

I respectfully disagree. The "market" has no idea how to value EUA and I don't expect that to change. The way to value EUA in the future, just like now, is on the basis of what's in the ground not what a fickle, manipulated marketplace full of information asymmetries suggests.

Let's say the special dividend is £1.00 and the share price re-rates to £1.15 or something like that. Once the dividend is paid, it would probably crash well below 15p as the herd stampedes for the exit. Is 5p, 10p or whatever (a couple of hundred million pounds or so) fair value for a company about to embark on the Rosgeo JV with full state support in an era of rising PGM prices with an implicit guarantee that it will eventually be bought out by whoever bought Monchetundra?

Personally, if the share price tanks down to anywhere near those levels, I'll be aiming to double my 500K holding so that I've got a million shares ready for the JV cycle to rinse and repeat.

I'm looking forward to the post-dividend selloff personally. Anyone stupid enough to sell their shares at that point deserves to have the patient use their own dividends to hoover them up.

Yeah, the whole point of the BOD doing it as a special dividend is that, to realise full value, we have to be prepared to take our money in chunks. Think of it this way: EUA is worth to us, say, £3/share between now and 2030. The BOD has two offers (they have more, but let's say two).

1. A full company sale now for £1.50. So that's it. That's all you'll get if you take the money and run. You lose £1.50.
2. A part-sale of assets, for £1.00. So, you get that now, and then annual dividends or another special dividend for the JV down the line (valued at PGM prices then, not now). You gain the full £3.00, but you might not get it all for a decade or so depending on how things pan out.

This benefits everyone: it reduces up-front cash on the part of the buyer; it maximises our gains over time; it means EUA and its shareholders realise full value of the assets and benefit from rising PGM prices too.

A different way of thinking about it is that we're effectively lending the eventual purchaser of Rosgeo the money now that they'll pay back to us at a stonking interest rate of hundreds of percent. This benefits them as it means they have less actual financing need. Let's say they pay $10bn eventually for our full £3, but only (for example) $4bn up front with another $6bn down the line. This is far better than a full company sale, which would simply represent us choosing to dilute our own profits and it would only benefit banks: the purchaser would front up an extra $2bn, but the overall cost to them would still be in excess of $6bn after a decade of interest and/or foregone investment elsewhere. Even if they're paying it down, it wouldn't be pretty: at least another billion dollars, possibly more. Even AirBnB had to pay over 10% recently for a loan of $1bn, how much would it cost to finance $6bn in a Russian metals project? I reckon the $6bn up front cost for a full buyout would be getting on for the $10bn they'll pay (in this example) anyway. So, it's far better for all concerned to "borrow" from us patient shareholders with an IOU to pay that money out as cash once MT has generated spectacular revenues for them for a few years.

ACF were keen to stress the conservativeness of the assumptions in the report today. My thinking now is that if it's mainly an MT asset sale for now, we must be looking at something between 80p minimum to £1.50 special dividend (between $4bn and $6bn). I'd love it if they managed to negotiate a free carry too: even just 3% or something would be amazing.

My suspicion/hope is around £1.25 for the special dividend, taking out fees for UBS/Piper, any warrants/options (my understanding was that we actually already had something like 3030m shares fully diluted before this placing, but could be wrong) and holding some back to finance the JV.

Give it a few years, and that will be raining dividends: over $100bn in-ground assets at today's prices, which are only going one way. Either that, or we continue to prove up and sell on for another $5bn+ (could be much more depending where prices are at by the time it happens) to whoever has bought Monchetundra around, leaving us all with another nice juicy special dividend.

Two bits of brilliant news this morning. I liked the cheeky mention of Sinosteel in the placing RNS: if that isn’t a not-so-subtle hint to the company’s suitors, alongside the American institution buying in, I don’t know what is. EUA is derisked and doesn’t need to sell anything if it doesn’t want to.

As Tilly might say, that's put a little twinge in the old mutton musket. Best give it a polish to get the technique right for when we wheel the palladium cannon out and start firing ingots of metal out of it.

"I imagine the BOD could put rough deal figures out but would be irresponsible if fell through or late better offer came in either way risks to LTH or new buyers."

Agreed. They won't release anything until it is firm. It's far too great a risk when we're talking billions. My hope is that we'll get news next Friday to digest over the bank holiday weekend, but it could well be that they'll take it up to the wire in early June (although, if they do, that would then give less time for shareholders to get their act together and make sure they vote).

Either way, it is probably worth a few shipmates delving down into the stores to bring out the medieval bucket of brasso and start shining up the palladium cannon. Maybe check we've got enough of those really long fuses and some giant matches. We could even do a test run and fire a few green muppets into the sea.