Member Info for Montmuzard

@Ginger - absolutely right. Then factor in the bidding war, last non-consolidated palladium play, Rosgeo, commodity supercycle and it's very easy to see how we move beyond £1.27 pretty rapidly.

That volume plus the scale of kippers into, presumably, very sticky hands, suggests to me that the share price isn't going to be hanging around here for long. Only a matter of time until it starts ploughing decisively northwards. Anyone selling now really is risking locking themselves out of the big one, which could come at any time. Hell, it might even be tonight: these guys like a Thursday after hours!

My word there are some nonsense-mongers doing the rounds today. Which is great. Means we're on the cusp of something magical. So what are people's new price predictions now we know sort of what direction we're going in?

I originally had £1.48 on full sale, going up to £2.64 after the Rosgeo announcement. But who knows what value has been unlocked by this deal? The numbers are mind-boggling on the potential JV.

Option 1 - if we're just selling MT (and maybe) WK, then I reckon we're looking at around £1.20 for a special dividend now (based on a sale price of about £5bn - though we're not helped by sterling appreciating against the dollar lately) followed by astonishing annual dividends in the Rosgeo JV: platinum could be $4000/oz by the end of the decade. So, over 20 years at 75%, even just mining a quarter of what's there and halving for costs, you're looking at somewhere in the region of £40bn. Conservatively, over 20 years, that's an annual dividend of at least 50p and potentially a lot more.

Option 2 - sell all the assets, but retain the company shell, some exploratory capacity, databases etc. (Volchetundra?) and I think you're looking a much higher special dividend now (around £2+) with, hopefully, a nice recurring 5% or something of future revenues. Marrying the Rosgeo JV and MT/WK together, who knows how much that could be worth? The buyer (Japanese consortium?) gets full control over essential minerals, and is happy to defray some of the cash risk now by giving us a nice little treat every year. It's impossible to price up, but palladium could be $10,000/oz by 2030. Or, with a 750k/oz sold, that's £7.5bn. So, just at at Monchetundra, 5% would be £375m or a 12p dividend. If it were more than 5%, it would be more. Then add 5% or whatever of the Rosgeo assets too, and any other assets EUA 2.0 has repeated the cycle with.

In either situation, anyone still holding EUA stock in 2040 will have made, in my view, a minimum of £5 or £6 a share, and quite possible an awful lot more.

Hey Dean, how do you fancy a nice trip to the green penitentiary? It's nice and cold in there. Full of rats. Enjoy!

"Plenty of people taking profits off the table, the trouble is you don’t know what the bod are going to do next, very risky in my opinion".

@Pete - Absolutely. Let's hope they're letting the 10 percenters and shorts out, before we get the big one at 10am!

So, the thing I've been wondering is: what does "substantially all assets" mean? I know most people are interpreting this as selling MT, pay a dividend of c.£1 or so and then develop the Rosgeo JV. This would make sense in general. But it doesn't explain, to me, why, if the bidder came on *after* the Rosgeo JV was announced, they would subsequently blow all other bids out of the water (unless they wanted to partner with EUA in certain respects down the line). So, I have a slightly different theory: it's a full company sale in all but name, however EUA carries on as a going concern to do some exploration and, most importantly, dish out the recurring dividends for the next 20 years that the BOD have negotiated for us as a percentage of future revenues. Everyone wins: Rosgeo/government has a trusted partner in the region while seeing all its assets taken to mine; we get a bit less than we would have for a full sale now, but more over the longer term; the buyer doesn't have to shell out quite as much cash initially, in return for sharing more down the line while mitigating the risk of price/currency fluctuations.

To all the kind green monsters who have spent the past few months "helping" us by encouraging us to jump off the galleon and into the shark-infested waters. Your ranting and raving - like the ghosts on Pirates of the Caribbean - has only encouraged many of us to hold our golden doubloons and stay on the boat for as long as possible. Tomorrow we fire the palladium cannon!

And Eurasia is currently trading at a 19 x discount to the Sibanye-Stillwater deal adjusting for price changes on an EV-oz basis according to DShox. Just think about that. Without even taking into account last non-consolidated PGM play, the bidding war, or future price changes, just to *equal* the value realised in that deal would mean EUA is an 18 or 19 bagger from this point. Or, to put it in money terms, about £5/share. A fiver. With no premium for its rarity. Dunno about anyone else, but I'm holding strong.

You can't un-find a mine, especially when it's the last of its kind on earth!

On the question of negotiations, I have a theory on this which I posted the other day: I'm convinced that 'strengthening our negotiating position' means negotiating with whoever owns the other chunk of Monchetundra (and, to a lesser extent, WK) and not whoever is buying.

I may be well wide of the mark, but I'm guessing EUA are sitting on two bids: (a) an asset sale of MT, and then a complex series of JVs for everything else; and a massive Japanese/consortium bid for the whole lot. So, I suspect the external-facing negotiations are done and probably have been for some time, and for obvious reasons the company would like to pursue the second option.

However, my theory is that whoever holds the remaining interest in MT (and who could also represent the 300m shares that voted against the resolution) is the exceedingly patient obstacle in the road: in either scenario, they don't realise the full value they would do if they retained their 20% stake in MT as EUA or the buyer takes it to mine and generates billions in royalties over the next 20 years. They are therefore very reluctant to give it up in a time of rising PGM prices, when this really is the last asset of its kind on earth.

Indeed, if we weren't all desperate to receive wealth beyond most of our wildest dreams - and could afford to think in 20 or 30 year timeframes - we would be very reticent about giving our shares in EUA up in exchange for £££ today rather than £££££££££££££ in two decades' time.

Anyway, if this is right, I think EUA are basically presenting them with an ultimatum: we can issue 250m shares which you can take now for £X per share in the full Japanese takeover, or we'll just sell MT lock, stock and barrel for an even lower ratio. But that's the choice. You don't get to sit on your 20% forever while someone else takes all the risk of getting it producing.

If this theory is remotely accurate, it implies that £X is at the higher end of people's expectations. I mean, if you owned 20% of MT, which could account for many billions in revenue by 2040, what would it take for you to concede defeat now x 250m shares? My suspicion is we're talking pounds, not pence, and more than one or two of them.

Of course, I could be completely wrong, but it's a nice bit of speculation :-)

@Oriens - really sorry to hear that fella. Hope you manage to hang tight. It must be coming!

I’ve got a feeling in my bones. Something is gonna happen this week. Might not be the big one. But something is gonna drop. Possibly WK flanks. Possibly resource upgrade. Possibly a hint that FSP is nearing completion. Who knows. But we’re getting very, very close. I’ve got a big stock of medieval brillo pads out for polishing the cannon, anyway.

Aren't the "7" trades just people buying a couple of quids' worth on freetrade or whatever?

Huge congrats Mike. Wonderful news.

@Ginger - Great post. Given the time it's all taking, bidding war, Rosgeo, whatever Absolute Precision were up to, arrival of Japanese, rising price projections, last non-consolidated play, I'm having a hard time seeing a full company sale for anything less than about double your MT calculation now. Bare minimum of £1.80. Likely to be well beyond £2 IMO.

Where have all the green muppets gone? I thought they were here to “help” us see the error of our ways? Probably all round at Billions’s house/shed/cave writhing around on a bed strewn with £17.80 worth of 10 pence pieces with him and his mum. Otherwise known as a jubbing party.

Jub-tastic!

Depends on the financing. It’s true that many won’t have billions in cash on hand, but it could be financed, especially if we’re talking sovereign wealth standing behind it too. But don’t forget: any buyer swaps X-billion in money for assets worth XXX-billion. Their balance sheet is consequently much stronger, and the value of their company (and ability access more and cheaper finance) increase accordingly.

Reading Phil's piece has put an extra bit of wind in my sails. If you read and consider it closely, I think he's saying that some of the more fantastical predictions might not be beyond the bounds of possibility.

"It reinforced my belief that this is a once in a lifetime opportunity to be involved in a historically huge deal..."

Once in a lifetime and historically huge means one of the biggest ever. Bigger than comparable deals. Bigger than any other PGM deal ever done before.

"...that may not be very far from coming to fruition".

Well, that one speaks for itself. Time is running out. Could be days away once the jigsaw is complete.

"Eurasia is in the process of moving from small prospector with a reasonably large find, to owner and developer of a globally significant mind-boggling district of rare metals"

Globally significant is massive. It means "rival Bushveld". Rare means not much left: "last non-consolidated palladium play".

"...that’s importance is vital for the development of tomorrow’s technologies and therefore will only increase in value".

PGM prices are already going through the roof. These things are in demand, because of very recent technological transformations that were not envisaged even a decade ago, and that demand is only going to drive palladium up towards $10,000 by the end of the decade. Heaven knows what will happen to rhodium, iridium and all the REEs. There is no way these price projections are not being factored into negotiations.

"We now control huge deposits, vastly bigger than was announced not so long ago. The company is now a major force in the area rather than the small prospector we used to be".

State support. Enormous deposits. Prices going up. Value increasing daily. Hundreds of billions in value over the medium term.

"The race is on to control such assets by not only companies but countries".

State-supported investors = very, very, very deep pockets. These moves are about geopolitics and grand economic strategy as much as they are corporate decisions. Whoever wins the race for these rare minerals controls technological frontiers and global markets. It's a zero-sum game: you either win or lose, so you keep bidding until you win.

"I believe that when EUA has put all the pieces in place the resulting sale will dwarf the recent deals by which EUA has been benchmarked"

This is the killer line. Just read some of the data about those other deals. To give one example, the Stillwater deal was potentially valued at something like 17 x EUA's current share price, in an era when it wasn't the last non-consolidated palladium play, had far higher extraction costs, and PGM prices were considerably lower (and not yet projected to reach the highs they are projected to reach in due course). If Phil is right, then we could be looking at something far bigger than even a 17-bag from this point, and even "dwarfs" it. It almost seems incomprehensible. You can't quite believe it. But what if

I'm happy to dream of 200p.

Green muppets out in force today. Thankfully I can't hear them. Must mean the well is dry of stock, and they're panicking as the next big RNS could be inbound shortly, making it even dryer. Rums ahoy!