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Sorry - replace BCN with Blackrock...

@tomcat BCN aren't the ones doing the shorting in that scenario - it is whoever sold the shares that BCN lent them that would be doing the shorting. These short sellers would then need to publicly declare if the sum of all short selling parties that might act in concert held a net position greater than 0.5%. At least I think that is how it works!

Exactly @Ivybush & @tomcat. It was odd to see the price drop here on the apparent back of @Kiran's comments. Very odd. I suspect it was because some got the wrong end of the stick and estimated a placing at 15p/25p, rather than in the 30's which is what I took @Kiran to mean - as a minimum - to the delight of the shorts I'm sure!

According to:

"AIM RULE 26" (20 December 2018.)
http://www.bacanoralithium.com/investor-relations/restricted-aim-rule-26/
===[
The following table sets out the results of the analysis of the significant beneficial holders of the Company's Ordinary Shares as at 20 December 2018.
]===

Blackrock had 5,943,940 shares which is 4.4%.

I wrote:

"$220m / 500m = 0.44c = 34.7p"

should it be:

$250m / 500m = 0.5c = 39.4p

How much more is required? Is it $220m or $250m?

Out of interest @stroga - how can you be sure Blackrock left everything by 100% in the last 2 months? Presumably once they are below notifiable percentages no-one can know.

But why not?

8a = 2.5%...
8b1 = 2.5%...

or any other combination which adds up to 5%? Including 0 and 5.

Coming back to the 15p value the shorts are using to spook the longs. I presume it comes from the 500m shares authorisation and the original $100m equity raise element of the failed capital raise in the summer. i.e. $100m / 500m = 20c = 15.8p. Leaving $120m to raise elsewhere. Doesn't stack up to me! But I can see why it might spook some who might not think it through...

This seems a more realistic calculation:

$220m / 500m = 0.44c = 34.7p

I'm not saying all $220m will be raised on market, perhaps it'll just be $50m, perhaps it'll be as much as $150m. Or 0 or $220m even.

OK @tomcat. Now what?

Exactly @tomcat: we don't know how much of the remaining 5% (as of 10th December) they had lent out or held indirectly through subsidiaries. Somewhere between 0 and 5%.

Indeed @addicknt. I'm also not sure who would (continue to) short at 21p. I'm not even sure why a 25p placing was bandied about at one point. From what I gather it appears someone misheard/misinterpreted @Kiran's comments in the KDNC webinar: he estimated a fairly caveated "in the 30p mark", referring to a backstop figure based on the new share authorisation given in the AGM and the balance of the funding required. It could, and should, be much higher! IMHO ;-)

If you haven't seen it the explanatory notes of the TR-1 might help a little:

https://www.fca.org.uk/sites/default/files/notifications-major-interests-shares-tr1-30-june_1.docx

but not a lot!

TR-1's are confusing for sure! I think the point is that on the TR-1 you have to make a declaration of what voting rights you might have if you were to exercise all of your financial instruments + direct/indirect holdings. In the case of securities lending this would include a recall of shares. In terms of the FCA short selling record - it is only when unconnected identities hold a *net* short position above 0.5% that they have to publicly declare. They have to notify the FCA above 0.2% though - which they keep private. For example there could be 10 unconnected entities each shorting BCN by just short of 0.5% for a total 5% short - all making use of Blackrock's 5% holding. Or 100 at 0.05%.

@addicknt, I'm interested to hear what you think "Securities Lending" could imply in the TR-1 if not shorting?

This reasoning is flawed:

"If this reading is correct, which I'm not certain it is, then they have indeed sold shares down from 9.96% to less than 5%, and potentially all the way down to near 0."

replace with:

"If this reading is correct, which I'm not certain it is, then my take is that on around the 10th of December Blackrock owned 5% of BCN, of which they had lent out somewhere between 0 and 100% of this holding"

The TR-1 appears to me to be saying that the total percentage of the shares Blackrock own through their subsidiaries which haven't been lent out is somewhere between 0 and 5%, and that the total of the shares they own which they have lent out is somewhere between 0 and 5%, and that the total of these two is now less than 5% - which is presumably the reason for the notification as their total voting rights on a share recall would now be less than 5%. If this reading is correct, which I'm not certain it is, then they have indeed sold shares down from 9.96% to less than 5%, and potentially all the way down to near 0.

Is that your understanding @tomcat?

@tomcat If they are net short I believe we would have seen it if the net is above 0.5%:

https://www.fca.org.uk/markets/short-selling/notification-and-disclosure-net-short-positions

That's my understanding @tomcat. It couldn't work any other way. It's impossible to tell exactly what has been going on, but it looks to me that Blackrock have lent out a good fraction of their shares (presumably for short selling), and may or may not have sold any directly. If they haven't sold, and for whatever reason need the voting rights back in a hurry, a recall could surge the market significantly...

Round up, round up: buy one get one free! DYOR ;-)

As mentioned in the KDNC webinar earlier in the month, various assumptions and factors, including the current disapplication of pre-emption rights, "equates to a placing in the 30p mark". As a backstop this seems about right to me, but could clearly be much higher if sentiment turns in the run up to funding, Orr-Ewing estate fully exits, and shares lent out are recalled...

Which reminds me, is it possible that both Blackrock and the Orr-Ewing estate haven't actually sold as many as they recently declared, but may have in fact lent out some of their shares to short sellers? It is the borrowers that hold the voting rights right?