RE: Re falshoods1 May 2019 15:58
I am sure many may be aware that Standard Chartered withdrew from funding resource co*s yonks ago.
Following this, it is common knowledge on Twitter and mining news that funding from banks has practically dried up for lithium projects especially.
It is common knowledge that funding via placements would be at a discount for obvious reasons. So, the discount is within that range. Result is that it has been over-subscribed.
In general, corporate funding would require some commitment from investors and the general proportion could be 1/3 from investors.
In some cases, where there is a JV partner [mining], then the partner/s could take up a placing.
Lastly, from the earlier FT article written by Neil Hume relating to JP Morgan, on reading the details, one could conclude that if not for the CEO*s historical C.V, the JP Morgan event may not have taken place? The article also cites that Fortesque is now the 4th largest in the world for that segment. That*s the way I read it given the data including about the CEO.
Bankers & funders look for long life mine ie maybe 30-39 yrs so SXX*s 100 yr mine life was helpful.
They also look at low cost producers and for Tier 1 jurisdictions [Western countries like USA, Australia etc].
If SXX was not of sufficient size ie the deposit ranked in its own segment within the top 3 or so, it may not have had a chance of securing funds? This is just general and within a range although it is not specific case by case study.
So, overall, the CEO has to ensure that the co survives and the funding was the best available at this time?
I am happy with the results in that one would be cognisant that lenders have their requirements.
All projects come with risks hence why Shore Capital talks of de-risking. Or rather the process of de-risking?
That*s my perspective only. I had expected 16p to be the average. The 15p may or not materialise on the open market, one will have to wait to see.
DYOR.
Wed 1 May 2019.
Sign In
Follow the stocks
