Member Info for mv01

Yes rover, exactly my point this afternoon.

I as a cornerstone put there 100+ mil.

Now I need to put say another 50-80 whatever.

Why the heck do it at 3p and wipe off my first 100?

1.

Do at 20, i recover 25-30 cents to the dollar on first day of announcement.

2.

Do at 30 I recover 40-50.

3.

Do at 3 I don't even buy toilet paper to save my 4ss.

In 1 I get to own 31% of the shares.

In 2 I get to own 30% of the shares.

In 3 I get to own 33% of the shares.

What is my objective?

To make a return. Not to own the max possible percentage of toilet paper.

The price is not dictated by the little mikes and the little johns.

This is not going to be decided on the pennies that distorted the price.

It's bound to be the millions doing the talking.

All fair and square Wasarunner and I fully agree.

But this now the good pass your giving me to say this.

The fact that the sp had dropped to these levels is indeed an indication how severe the situation, how likely it will not survive and all that nasty stuff.

However, looking at the current price, given all above, is not at all an indicator as to what price any new equity might be raised. I am even arguing that the key players here deciding on dilution ratios will want to do precisely NOTHING about what the little mikes and johns have pushed the sp at. NOTHING.

It will not be an input to their calculation when they do that.

And I say this with full conviction and protest to anyone who may say or think otherwise here.

A stupid mike here, talking about myself, who may have decided with literally pennies to push the price to 4p will hold no cornerstone or bank hostage as to how they might want to engineer a dilution ratio...

...should we all find ourselves in the happy scenario that this will be funded.

4p, 10p, 20p or wherever it ranged in various instances after some bad rns's dictate absolutely nothing as to what raise price they might decide here.

I am basically calling this on the idiosyncrasies of the very asset we trade on in liquid markets.

It's just vastly extremely thin volumes for the price to mean anything for a deal.

I think I really exhausted the matter for myself at least.

I am just trying to derive from simpler propositions.

I studied Quantum Information theory at uni, I am a logician by trade. Not saying it for at all any credibility - but merely introducing my thought process to you as i apply it to anything.

(You should see me how much math i solve in grocery store before i decide which eggs to buy! The 6 pack or the 12 pack this or that price and with what utility - they go bad after 2w for instance if you dont use them all so careful on the 12pack cheeper price per unit!)

I am really not trying to convince anyone other than myself by putting it into smaller propositions.

Another math exercise I just did is what it may take a new investor to come in.

My assumptions are they will only come in as a 2:1:1:1 investment to the existing ones. Where roughly they come with 40% of the equity money, the existing corners put 20% and they all get this way 400mil. 160mil +3x80mil.

They all do it at such a dilution ration where the residue market is reduced from 49% to about 10%.

I.e each gain/raise their equity share to about 22%.

I found the price: 18p can do this so just shy of 20p.

So it CAN all be engineered at about sp nominal value. In my ming there is no doubt that dilution can be kept low.

The only trouble and always has been the trouble I should say is the actual figures needed.

I think 400mil is a lot of money.

Its a huge risk, but it is the only risk I see.

People called me as living in some cookoo land. Which I so do - but I think thinking that the current sp is any indicator of what we may get in terms of a deal is complete nonsense.

A couple of johns and mikes, regular dudes and ladies we decided to crash this market trading as thinly as at most 50£k a day.

We wiped out 440m of market cap with a mere 1mil.

Prices and market cap are elastic.

We rely on thw news we get.

The cornerstones might raise this even at 40p.

May even make most of us scratch their heads on how silly they are...

...but actually could be a vwry smart move.

The heck with 50k implying the market cap!

This has to be done with the millions not the pennies.

Correction:

If we do it at 3.5 p we each get 33%.

(Not 32% as said originally)

And this is my super seminal point of my thesis:

Say as the cornerstones collective, decided to put in the 450m.

If we do it at 3.5 p we each get 32% of the equity leaving a residue of 4% to the rest of the market. And we completely lose on our previous holding value.

If we do it at 30p, same cash put in, we actually get 32%, but we make 25p to all of our previously held shares. About 20mil each!

So the question is that 1% difference in holding 32% instead of 33% worth 20mil?

No.

So to me not sensible to raise at 3.5p

More sensible to raise at 20-30p.

Holding 30/31 of something, is not a heck of a lot more different than holding 100/101 of that same something.

But what you leave as an SP (bound to be a function of the new equity raise price) matters like hell!

Basically with a higher price, cornerstone puts in more money to new share, and they immediately make back a recovery a proportion of that with their existing equity share.

Do this on a very large dilution multiple you completely wipe off the effect.

Do this with a very small multiple is impossible if all 450 has to come from equity. By only issuing 450m new shares at 1£, will push the maekwt cap to 750£m if price stays at 1£. Or 600m if it drops at 80p.

So why the heck raise at 1£ to see drop at 80?

Where is this extra 150m-300m in market cap value come from by virtue of just the equity raise?

The 1£ is impossible.

The 3.5p is also not sensible to me.

There is definitely a sweet spot at 20-30p raise.

And this gets further pronounced if you only need to raise 50-70% as new equity instead of all 100%.

I think it's very interesting this whole thing...

Hi Wasarunner, whilst I see your point I don't take it fully.

I mean i buy the 100% vs 50/50 equity argument, but the price is very relevant.

If for instance one were to raise 450mil at £1 that won't take the market cap to 450 - but to 750.

My thesis here being you cannot raise at a price without the sp reacting. And £1 wont cut it with the math.

3.5p might cut it with the math, however my gamble here is that this completely wipes-off previous investment by all.

Now if you are the 3 cornerstones, and decided you want to put the equity needed, and you can somwwhat arbitrate the new share price between 3.p and 1£ - then why actually not do it at 20-30.

I did the math, and there is a local maximum suiting the cornerstones and the rest of us. And that price is actually at that level 20-30p.

What happened Billy?

Only half decent RNS?

You are not mellowing all of a sudden? :D

Happy Friday. I am playing the odds. If the existing cornerstones want/are forced to pump in more equity, it doesn't suit them to do so in an extreme dilution, a lower dilution multiple still achieves getting a higher proportion of the equity, whilst preserving the value of their existing.

Anyhow, this is just my personal wishful thinking nothing based on fact...

Happy Friday all, keep positive.

Well I exposed my trading history...

I shall be happy with an up to 10x dilution.

That's like giving 90% of the share open interest to be to the new raise.

It all depends now how much it would need to be raised by equity...

Ball park figure of 180-200mil?

Doing it at 2p is 30x

Doing it it at 6p is 10x

I still think that anything in the 10-30x dilution is terribly not sensible... But I am very naive in this aspect (not exclusively)

I think raising it at par nominal value is quite sensible, yet been accused of living in cookoo land for saying that! And i embrace it actually... no offence taken by that.

No not saying that at all. I have no conclusion yet.

But we cannot read that RNS and exclude the possibility of say this narrative:

We exhausted all possibilities to a finding pack.

Therefore its going to be admin.

But if it is going to be admin, then why not try to do it as smoothly as possible?

Lets protect against the odd contractor/subcontractor we have on site from calling us on a deferred payment, so that we can plan the pre pack smoothly.

I mean if this story data fits reality at all...

...how might one have crafted the rns better?

The true point of them having to post the rns to me, is the extension of deferred interest payments.

But there is a clear change of tone as well for me in the wording...

They went from statements that we will find something fit for all investors to now something that it may not be fit for all.

Anyways, bottom line for me is that you cannot take this rns and outright exclude the possibility of them planning for prepack. You simply cannot.

Me saying now this, is not the same as same as saying that this is what they are actually doing!

Again, and with the full conviction of being loaded this and want it to play out I cannot disagree more with this statement:

""On re-reading the RNS several times,this certainly does not feel like an administration scenario or a pre-pack as someone else suggested. ""

For arguments sake, If say they were actually on a path to a pre pack, which is somewhat a controlled version of an admin as opposed as to a chaotic uncontrolled one,

The this is exactly how to mastercraft the rns

Hi Wasa,

Heres a mental exercise.

Say the BOD sits with the hard facts and they decide the bill 180m from new equity, all from existing cornerstones each at 60mil at par. Rest debt.

What would an RNS of 900mil new shares at 20p do to the sp and liquidity.

Alternatively

What would an RNS of 9Bil new shares at 2p do to the sp, and liquidity?

I actually made my mind. First RNS it's in favour of the cornestones themselves as well.

I am simply arguing this point on the dilution multiple on a fixed amount of dollars needed to be spent.

To me it's not the 20p the problem, its how much equity.

As a ball park figure say they needed 180mil to come from equity. And price is set to 20p that is what?

900mil new shares? Or a 4:1 dilution?

If I had 15% of something... and that something is now 4x bigger, and I get an exact 1/3 for the new issue i end up with what?

(15% + 1)/4 = 1.15/4 = 29%

With a maximum possible 33% if the dilution multiple was... oblivion.

This is the math folks.

I don't fear the dilution...

I actually fear the absolute figure needed for equity and if it can be found.

Lawrence I think looking at it from a consolidation perspective is the wrong way. What consolidation does is make a number look more attractive than if not. Yes if there is an 100fold dilution a 100fold consolidation will be a good idea, in terms of looking at a good looking sp number... as a number...

But still the fact that in such scenario you only have 1/100th of the previous market non owed by the cornerstones still makes my point even more pronounced:

How much actual residue market is left to make this trade? You even force into being more illiquid. You as LM and O cannot actually trade it - you effectively own it.

They might not want that. At least this is how they introduce themselves as businesses. We do not own mines, we own shares in mines...

Anyway... it may be entirely subtle.

But the point here the dilution multiple differential is extremely marginal for the bug sharks.

But colossal for the small PI.

10x takes your 15->32%

100x takes your 15->33%

Why the hell choose 100x and completely kill the residue market? Thats my question.

If they need to pump in 100mil (as new equity - for argunemwnts sake) they still HAVE TO pump that 100mil regardless of dilution multiple!

The subtlety here is the distinction of the absolute figures needed, vs the relative dilution multiple you have to impose--- and for what marginal benefit!

10x may leave the residue market surviving..

100x may completely kill it.. and for what actual extra benefit?

What do you do?

And that now reveals the logic fully of my second x invested.

Outright stating that I am ignorant to new equity raise under this circumstances. But I still think that dilution to oblivion is not necessarily fully helpful to the parties getting the new shares (assuming it won't be new comers)

You need some left over interest to trade whilst you hold your shares old and new, right?

Say they do 100 to 1 dilution.

And under the model LM and O like to do business, own shares not the mines directly, then how would they actually make moneys in the market? How if this thing again will trade on an even thinner market?

Plus I'd argue that the marginal benefit of 10x vs 100x dilution is not actually that grant!

If I own 15% of something, and then this gets 10x diluted, then I end up with 32%

If it actually gets 100x diluted, then I end up with 33%.

So i ask: why would I be interested in squeezing the free to trade market to such extend (shares I dont own) if i want to make money in that market?

I think the limiting factor here is the actual monies needing pumping as new equity in absolute terms, instead of the actual dilution factors.

And by that token, i do actully believe if there will be dilition this wont be on a crazy multiple.

Really do the math..

Another comment on why I don't believe for a second that the marketCap is an input to the whatever finance solutions are discussed.

Take the example of today's between 8am and 8.25.

The stock price fell 20%. implying a market cap drop in absolute terms of around 2million.

NOW

On the flip side, if you look what trading activity did this, it's about 15 trades, by regularMikes like myself, and regularJohns like yourselves trading at most 1k GBP per trade.

let's take an upper limit and pretend that without loss of generality, that all trades were 1k each.

What do we have here?

A market Cap drop of 2million, by a mere 15k trading!

That is why I don't for a second buy any argument, that any equity raise, will be done in CURRENT observed share price or market cap.

It has to be done on predicted current value of the asset, and its liabilities. NOT driven by a couple of mikes and johns in the market.

This stock trading is EXTREMELY THIN in regards to the grand scheme of things.

We still rely on that final break or make RNS.

Yes, the fat lady hasn't sung yet...

True, I place my entire thesis on grander picture, than the johns and the mikes and what we all do with our pennies...

I'll hold my fort with full conviction, I do think its the right call.

And I will even give you my trading history as it manifested.

I risked x units of money to by stock at 1.40

I managed to sell off at 57p, buy back at 20p,

then sell of again at 14p, buy back at sub-10p,

and now I am overall exposed with 2x units of money, averaged at about 7p.

or with more than actually 50x my original number of shares in this.

I call this a good way of risking that second x, to help me break even, even if there is a 10to15-fold dilution [and assume some recovery after that].

But But But... it is indeed very risky business. I can see people are trying to save something here... for me it wouldn't take this terribly long if they were not genuine in trying... I never bought into the intentional bias, let's just screw up the small investor by the big sharks.

BUT BUT BUT, regardless of all that... it may very well be a terribly big problem here to chew on, even if you are 100.0000% genuine in trying, and actually solve.

I am really proud of my personal conduct around this trade.. even if I were to lose the 2x.

I did well in trying to catch this. and already at peace with the prospect of utter failure.

Cheers.

Extension of interest repayments waivers to end March, previously Feb.

protective measures to negotiate indebtedness - allow time.

strong caveat no guarantee that a re-financing and re-structuring solution will lead to a positive outcome for existing shareholders and noteholders of the Company.

clinical with the facts. no positive twist to it, risks stated as should be.

here's still hoping, but do not go admirable painting this a more positive than it states.

In so much I still believe some good news can be delivered here, I can't but agree more.

Give it a rest already - nothing that can be said here in the absence of further news - good or bad- is anything short of being mere conjecture...

And personally I only like a singular conjecture:

Goldbach's... none else.