Member Info for OofyProsser

I think Botswana is better than most.

Re prosecuting senior RBZ officials, I think they will be covered by immunity provisions in the Act establishing the Bank. I don’t think Vast can do much in this regard.

Thanks, Matador78. But surely, since there’s no doubt as to title, the required procedure should be the standard procedure for any diamonds? What’s so different about these diamonds that makes their treatment unique? It’s all bs, isn’t it? As I’ve mentioned before, it’s a matter of public record that Mme. Mugabe owned a diamond cutting business in Hong Kong. One can’t see the RBZ giving her the bum’s rush when she or a couple of her husband’s heavies came to the counter and asked for them, as they did the Harare Deputy Sheriff and the Vast representative. She’s had it away on her toes with them, hasn’t she?

Asimpleinvestor: thanks for your response. Are you saying that there is no established procedure for each of these steps, and that it’s different every time? Otherwise, since Vast know what they lodged at the RBZ in 2010, what has stopped them fulfilling all these steps before they’ve gone to court? The High Court seemed to think that Vast had the right to pick the diamonds up. Their officer was, however, shown the door by the RBZ and a statement was put out which is Kafkaesque bs as to what happens next.

Occam’s razor suggests that there’s a much more credible, simpler explanation for what’s gone on re the diamonds, in my view.

Asimpleinvestor: if you went to the court to get you4 car out of the pound, you’d be stupid not to have got tax, insurance, MOT etc. sorted out beforehand. Otherwise you’d be shown the door until such time as you could produce them. Is that what’s happened here?

SillyButtons: yes, and the charge on the senior loan precludes further borrowing by Angus without the approval of the parties to that loan. So until that loan is repaid, there’s no chance of further loans. And who’s going to lend a company in Angus's position money which is merely going to pay off its existing lenders and thus trigger the 8% royalty? And the current production level and occasional compressor outages, plus a disappointing (so far) winter gas price, won’t be giving any lenders much confidence in the safety of their capital.

Oktane: if, when it comes to it, the Board characterises the conversion of the bridging loan to equity as a “rescue” (alternative finance being unavailable) the conversion price could be so low that the new shares will represent a lot more than 40%. There’s a lot of potential downside here that few people on this site seem to understand. It may not come to this, but it’s a distinct possibility. And if Angus do manage a Global Re-financing, I think it may well be on even more onerous terms than the existing loan terms.

Excellent post, Invest. Rem acu tetegisti.

1. Who independently verified them?

2. Shareholders of NMC (a FTSE100 company) and Finablr might dispute your remark about Polly Peck.

3. I said “pretending they're there and about to be handed over. ..” How long are debt and equity investors expected to wait to be given proof of the diamonds’ presence in the RBZ vault and of the RBZ’s willingness to hand them over? No reason has been given for the delay, nor has a date been set. Nor has anyone from Vast seen them. The debt deadline with Alpha was 30 November. Vast has no means of repaying this loan, other than from the proceeds of the sale of the absent diamonds.

4. Mr. Prelea, not the company’s lawyers in Zimbabwe, is responsible for what information is released to shareholders. I’ve no idea what his lawyers are telling him.

I’m not arguing arguing about his salary either. The fact is, though, that far from his not paying himself a salary, as you assert, Mr. Prelea has in fact been very well paid.

I’m not arguing either that the absence of the diamonds is Mr. Prelea’s fault. Pretending that they’re there and about to be handed over is his fault. I suppose you may argue that maintaining this pretence is better for the company and its shareholders than admitting that the chances of ever seeing them are slim. I think it’s inadvisable, however, for shareholders to put any credence in their accessibility. And if the lenders come to the same conclusion, that’s when things will get awkward.

So you think Me. Prelea is paying for the privilege of being at the helm of this horlicks, do you? Look at page 21 of the Report and Accounts, the Driectors’ Remuneration is tabulated there.

Kever: what makes you think that Mr. Prelea has not taken a salary for some time? That’s not what it says in the 2023 Report and Accounts, which lists his salary as $258,000. About $23,000 of this was deferred and is owing to him. So $235,000 net. Not too bad really, for the CEO of a company capitalised at about £5mm and counting. And then he gets those nice stays at Victoria Falls while discussing with the lawyers, the Harare Deputy Sheriff, the RBZ etc. the process by which a protocol will be developed whereby talks can commence on the methodology for establishing a process leading to the discovery and handing over of the historical [in a real sense] parcel of diamonds to Vast. Very nice too. You wouldn’t read about it, as his countrymen used to put it.

Bubblepoint: yes, I think there’s a strong possibility that the bridging loan will be converted to equity. But this will necessitate a full bid for the minorities, since the new shares, added to the Aleph group companies’ existing holdings, will far exceed the % required for a bid. As I understand the rules, if the conversion is characterised by the company as a “rescue” - which it would be very easy to do - the standard rules on pricing won’t apply and the number of shares subsequently owned by the Aleph group may as a result substantially exceed the number owned by all the other existing shareholders. I think there’s every chance that, by hook or by crook, the outcome is going to be very disappointing for minority shareholders.

Yes, Bubblepoint, I agree with you. They were trumpeting their expectation of 10-12mmscfd from the two wells plus sidetrack and two compressors, weren’t they? Now, with three wells and two compressors, it’s between 4 and 8mmscfd. And, as you’ve pointed out, the gas price isn’t looking very strong. Maintenance was predicted to take up 10% per year, during which they couldn’t produce. It seems to me those compressors are proving less reliable than they’d expected. The Global Re-financing, which seems to have evaporated into the ether, is likely to be on worse terms than the financing it replaces, in the light of the risks, which have clearly worsened since the senior loan was signed. And the new terms will encompass the 8% of turnover royalty. It’s going to be slim pickings for shareholders, if any.

I liked the previous management better. At least you knew where you were with him. Every time that hungry grin appeared, you could be sure it vouchsafed a quarter-truth or so. The new, grey, chap says absolutely nothing new every time he takes up the pen. Bring back Boris! No, George. There’s far too few OE’s left on this Board.

Noelpbz: I’m fully aware of this, thank you. Yes, Angus will pay the difference between the price per unit and the market price for every unit by which their gas production falls short, probably on a monthly basis. No, they will not need to go to a gas supplier and buy physical gas. I should have thought this would be clear by now even to the person with the weakest grasp of the workings of forward contracts.

The gas flow appears to be rather volatile currently. As things stand, they’re safe on the December contract. Way below their expected post-sidetrack production, though.,

Bubblepoint: if gas flows continue to weaken, Angus may be grateful for a lower gas price. Once flows fall below the volume required to meet the forward contracts, Angus will have to go into the market to buy gas to meet them, at the prevailing market price. A milder version of July/August last year and not an enticing prospect.

Vagabond72: so is the corollary to your proposition that a debt agreement implies the lenders have some favourable information on the release of “the diamonds”, that if there is no debt agreement, there are no diamonds? At least that would clear up the situation, but probably a bit too late to rescue Vast shareholders. The Harare two-step can’t go on indefinitely.

I’m not sure that a placing is an option available to Vast’s Board now. The share price is about 12% above the nominal price and the market capitalisation is below £5mm. Without the diamonds - any diamonds - they’re now at the mercy of their lenders. It’s possible the latter will accept a massive placing at an extremely low price, in a rescue package that would effectively disenfranchise the current shareholders. They might see this as a quicker and cleaner option than exercising their loan covenants.

SandyShore459: it appears that we speak a different language. If it’s not the RBZ’s job to enforce the regulations re Kimberley process etc., then why do they not comply with the order of the High Court, give Vast the diamonds, and have the appropriate government department deal with these aspects of the process that would enable the diamonds to be sold? And what an election has to do with it is a mystery to me, other than that there is no such thing as the rule of law in that corrupt country. If you’re saying this could drag on for a few years more, the diamonds, even if they’re still there’s, will be of little use to Vast, which will probably be a footnote in the sad history of AIM.

I shan’t comment on this again (unless there’s another upsurge here of over-optimism on the diamonds) and wish all holders good luck. I sincerely hope I’m wrong and that this parcel of diamonds will soon find its way into Mr. Prelea’s hands in saleable form.

SandyShore459: I’m sure all these steps would be necessary once the diamonds were found. Whether it’s the RBZ’s job to supervise the Company’s compliance with these regulations is another matter.

I think it’s worth investors’ looking again at that statement in the Summer about the protocol, progress etc. It was bureaucratic bs, signifying nothing at all. If the RBZ is responsible for policing Vast’s compliance, why have they not put a couple of clerks in their legal department onto it to write a paper for the Board’s imprimatur and get the diamonds into their owners’ hands - or, at least, tell Vast what steps they need to follow to comply with the regulations. It doesn’t take years to do this. A week or two, then maybe a month for the Governor and Board to approve it. “Protocols”, “processes” are obfuscation.

Most of your question and my replies above are superfluous. The important factors are just 2, namely:

1. Why is the RBZ (Zimbabwe being one of the most corrupt countries in the world) delaying what should be the simple handover of a company’s property, the High Court having told them to do so?

2. How are Vast going to meet their loan terms in ten days’ time without the diamonds and with no date for their release.

As for my position, I’ve been watching Vast for a while. I like volatility and it has real mining properties. But, in common with many AIM companies, it’s finances are a mess and it’s vulnerable to adverse decisions by its lenders. I keep mentioning the diamonds because everyone else who mentions them assumes they’re going to be released imminently. Maybe they’re right, but I doubt it. If I’m proved wrong, the share price will probably triple in short order, I should think.,

SandyShore459: In what sense, a one trick pony? Re the diamonds, if it’s finally established in another ten years’ time that they’re missing, how are Vast going to enforce any claim? I dare say the RBZ enjoys sovereign immunity in any case. If not, this two-step can be stretched out for as long as they want to do it. They’ve picked up the word “protocol” from somewhere and they like it.