Member Info for Montmuzard

You can go back a lot further than Diana. Plenty of (suppressed) evidence of Nazi sympathizing before and during the war, even to the extent that some elements of the royals were seeking to overthrow Churchill and install a puppet monarchy. Churchill himself sent a special unit to Germany at the end of the war to destroy all the correspondence between the Windsors and their aristocratic relatives, many of whom were implicated in the third reich.

Oh, and a few too many pictures of Prince Charles and Jimmy Savile chuckling together out there online for my tastes.

But yeah, it’s the intelligent young women who try to shine a light on what is a very weird institution that British working people puzzlingly doff their caps to - and which only exists because it violently cleared our ancestors off the land hundreds of years ago - are the real problem.

I agree with Castiron here. This is just often how investments and politics in developing countries work. CB evidently has good relations on the ground, but there was clearly sand in the wheels of the license, given the length of time it was taking. The government needs foreign investment, but it can't be seen to give the house away to foreigners (resentments about colonial histories of plunder run deep, and rightly so, in countries like Zambia). Plus, individual ministers will have their own ideas about who should get what. They'll be under pressure not just from foreign investors, but also local communities annoyed about pollution, access to jobs etc. as well as from local businesses who will likely be connected in some way (family, tribe, party affiliation) to the government. It's not easy to ignore those voices demanding a piece of the pie when your re-election, and therefore ability to redistribute resources to those communities, depends on it.

So, all things considered, this potentially strikes a decent balancing act: everyone remains happy with good relations, GLR get some money up front now with a bit more to come (albeit less than envisaged) for standing aside, along with, hopefully, a free run at Ka***tu and the opportunity to focus entirely on the two big projects. In fact, if the whole strategic point of SZ was only ever to generate the revenues needed to get KS off the ground, then it maybe has done its job?

@Billions - Yes, Sibanye-Stillwater's market cap is about $12bn, and the former paid around 1/5 of that to acquire the latter. It is, then, quite plausible that NN would pay a similar fraction of their market cap to acquire a single asset which will be generating potentially far more than $1bn a year once in full production, and will therefore increase NN's market cap substantially.

@mjs - I have had exactly the same thoughts as you. Every bidder will have been thinking in multiple billions and realising they can still make money, and all the while NN will be knowing that, no matter the price, they cannot afford not to buy it.

@Hoochy/Gary - I agree, the money side will be the easiest bit. Companies, especially those in a sector where the assets are finite, aren't like people: the last thing they want sitting on their balance sheet is large amounts of cash. They need to secure future revenue streams, and will spend big when those streams are fewer in number and getting dryer.

Is Billions Rowka?

"I’d love a $10bn sale as it would net over £7-9m profit, sadly I think that it’s something the board of somebody such as Nornickel could justify to their shareholders. After all, it’s 1/5th of their entire market Cap".

Yeah, and what would their market cap rise to once they had Eurasia on the balance sheet? It would certainly be more than it is right now, and it would, over time, be much more than $10bn. I've said it a few times lately: you have stop looking at the buyout price as "a cost" to the buyer. It costs them nothing. They are simply switching a relatively smaller amount of cash for a relatively much bigger asset. The overall value of their asset base and therefore company will rise ... dramatically.

@oldspurs - Good point, and normally I would agree with you, but not in this case. Surely even if (say) NN take EUA over fully, they will still want to retain the proprietary data. In fact, I would guess that this is explicitly part of what is being sold by EUA alongside the assets themselves. Given that so little, relatively speaking, is proven up, and this is the last non-consolidated palladium play, I can see a lot of benefit in them retaining as much opacity as possible vis-a-vis the wider world's knowledge of the specific outline of their assets. They'll literally be able to exercise price-setting power over global PGM markets. It strikes me that there's a lot of value in saying something vague and equivocal like "yes, we've spent X-billion on a large asset that currently has X-million oz of PGMs" while then spending the next 20 years applying for new licences, proving more up, and quietly adding to their truly monstrous reserves, all to be slowly drip-fed onto the market for decades.

"It's not going to get leaky. UBS AND DLA PIPER will not have their reputations ruined for some impatient investors..."

Yeah it will. It always does. Even if just for a few minutes before the RNS lands. Just think of the number of potential leakage points: outside of the core team negotiating the deal, at every single step - Eurasia, buyer, bankers, legal, Russian authorities, takeover panel, NOMAD, insurers, London Stock Exchange, the list goes on - there are higher-ups and lower-downs who know things or will know things, even if they just overhear a conversation in a hallway or see a photocopy of a document that relates to a minor part of the transaction with a date on it, before the market does. Some of these people will actually be very distant from the transaction itself, but necessarily privy to information where they can make more educated guesses about what and when than you or me. You're talking hundreds of people, which exponentially becomes thousands once it hits the City rumour mill. The idea that every single one of those people can keep their mouths shut is fanciful, especially when they've spent 18 months themselves gossiping with mates who are invested in EUA about it and will be pestering them for a cheeky nod. That simple fact of human fallibility and inability to keep a secret is why I don't believe in conspiracy theories.

My understanding is that it's very unusual. Most takeovers are with a premium of 50% or whatever. But then those takeovers are also generally of companies where lots of information is in the public domain and they are relatively easy to value in terms of future revenues. Even in the mining sector, how often does a junior explorer even manage to sell its asset, let alone find itself with an asset on the scale of this one? Eurasia is a complete one-off in these regards, so it's reasonable to suspect that the eventual takeover price will be a one-off too.

My suspicion is that it will get leaky before long and the share price will start rising quickly in anticipation of the announcement so that the premium is not as large in percentage terms as it otherwise might have been. If you think back to a few months ago when we had the big rise alongside the various tracker indices buying in, at one point there were buy orders on the book of 50p if I remember rightly (although they didn't get executed, presumably because they didn't need to). When news really is close, we could get up to and beyond that very quickly I would imagine.

The other thing to say on the transparency question - and what seems to me to be really the crux of the issue - is the enormous gap between proven reserves and the sheer unimaginable scale of what is actually under the ground. This is a colossal grey area and sweet spot for negotiations.

On the one hand, EUA officially has 1.9m oz of palladium. Fine, there you go, $5bn once mined. But, on the other hand, all of their proprietary data will point to potential multiples of this: tens of millions of ounces of palladium, the rhodium, REEs, nickel etc. contained in the flanks and flanks of flanks. How much is that worth: $50bn, $80bn, $100bn? Nobody knows, but EUA has oodles of data taken from their own work, stuff they inherited from Anglo, and decades of Russian state and academic studies, and that is the thing - along with their syntheses of it - that is kept rightly under lock and key.

Normally mining transactions are based almost entirely on proven reserves. In this case - the last non-consolidated palladium play, where only a tiny fraction has been proven up, and which EUA has another two decades of exclusivity to play with as prices keep rising along with a JV they can action at any time to start mining - all of that big grey area comes into consideration. We are all sailing on a galleon that really is a historical one off. Every single variable - 20 years of hard labour on the part of the BOD, Anglo-American's earlier disinterest, rising PGM prices, the coming post-Covid infrastructure boom, NN's cash glut looking for investments, the trouble faced by South African miners, the fact there is literally no other similar asset waiting to be bought anywhere on earth - has fortuitously aligned to make this company insanely valuable in a way that it wouldn't have been at any other time.

So, it is the proprietary data that determines where on the scale between the $5bn we know about and the $100bn we don't the bidder is prepared to stick a pin with a fractional number between 5% and 10% written on it.

"I am intrigued as to why there wasn’t more transparency, as it could have led to a higher share price"

Why on earth would you want transparency? It's like asking Tesla to give up their battery designs. Crazy talk.

Publishing more data may well have a short-term impact on the share price, today, but that doesn't mean it would necessarily lead to a higher sale price in the FSP. Quite the contrary. The whole point of having UBS run the show in the dark is to draw in potential purchasers (who themselves would not want to be identified) and keep nudging the price upwards. The only way you entice them is by dangling the carrot of the various bits of proprietary [read that word again: proprietary] information that are included in the data room, which itself has various doors that get narrower and narrower that only bidders invited into successive rounds of the process get to enter.

So, you give all serious bidders access to the general data room, but by the time you get to this stage, only the preferred bidder will have access to the most sensitive information. This has the effect of increasing the price during successive rounds of bidding - both because the bidder wants to access more data and also once they have that data they are prepared to pay more to secure the assets - as well as building trust between the two parties and locking the prospective buyer in.

It's madness to suggest that a company like EUA would just publish much of this stuff. For one thing, they would be naked in the event that the FSP collapses, with everyone knowing exactly what they've got, being able to attempt hostile takeovers etc. And for another, this isn't actually about EUA: it's about whoever the buyer is. Assuming it's Norilsk, there is no way on God's green earth that they want the rest of the world knowing the precise details of an asset that is likely to give them a dominant position within global PGM markets.

For as long as the takeover panel remains happy. That suggests that the takeover panel is happy, which means I'm happy. The longer it takes, the more complicated and intense the bidding war, and the bigger the prize.

I think it has been easy to hold all the way through. I’m holding a little over a half a million now. Started with more when I first got in around the 1p mark, derisked a few early on (which I now regret) and have averaged up a bit in the past few weeks. Seen tens of thousands of paper profits wiped off since the peak, but never wavered once.

The thing is, no matter when you bought in, if you bought in for the endgame, by definition there’s nothing to think about until that day arrives. I decided on day one that I was staying in until Dmitri does - and he hasn’t sold a bean - so any daily or weekly fluctuations are irrelevant.

Do I wish I’d sold 200,000 shares at 40p and bought them back at 22p? No question. And if I’m in a similar position in future I’ll take more risks in terms of trading a portion of a holding. But nobody can call the top and bottom of a market and I’d have been devastated if I’d sold some at 40p only for the big one to drop while I was out, and there’s no way I’d have had the cojones to let it drop all the way down to 22p before buying back in. So, given all of that, holding strong while ignoring short term market moves and extraneous noise - while buying a few around 22p when we hit the bottom, as it was evidently the bottom - seems the easiest course of action.

I ignore all emails from HL, including the ones offering me tailored financial advice for the bargain price of £495. Er, no thanks guys, I'm doing alright on my own ta. I'd rather buy £495-worth of EUA shares than pay your salaries.

I would snap your hand off for £1.80: it would be enough for me to retire in my early 40s, although I'd probably just semi-retire and keep doing the 50% of my job that I actually like for now. If it were anything close to £5, I'd be able to quit tomorrow and run off screaming into the sunset leaving under the biggest, darkest cloud possible with a trail of wanton destruction behind me. I quite like the sound of that to be honest.

Seems like we have a little bit of Thursday evening FOMO!

I can't see it myself, but £2.28 is in the ballpark of what Dmitri needs to join the billionaires club, so you never know...

Mad that anyone would actually sell right now. If everyone just held the line by covering their hands in honey, the price would go up even more quickly!

I think it’s a sign. A clear sign. DLA clearly told all of them to keep quiet during the vinegar strokes - you’d be annoyed if the guy you’re buying a house from kept tweeting about it going up in value every day - and this is a subtle way of saying that it’s all done, surely. Note how he also tweeted after market close too rather than the middle of the day. Makes me very hopeful for 7am tomorrow.

I'll take Mac's £1.55 as it's 7p more than my prediction, but if the BOD insist, I would also be happy with the £6.25 mooted earlier. As valuable as this all is, though, I can't see us squeezing $20bn out of the buyers, but would love to be proven wrong!

@Ethio - Agreed totally. I bet they already have the "insurance RNS" written and have made it abundantly clear to any prospective buyer that, if this deal collapses, all of this info will be in the public domain and they'll only have to pay twice as much in a couple of years if they want the assets.

Regardless of the big ups and downs, today is the first time in weeks the SP hasn't seemed to move within very tightly defined limits. For what seems like ages, it's either been 31.5 - 33.5 or (more recently) 20.5 - 22.5 or whatever, just bouncing up and down between them all day. Just by looking at a basic chart visually, it looks like it could go anywhere. Could that mean the MMs tight control over it to fill big institutional orders is coming to an end?

Jubmas is coming!