The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
The key section - they don’t even commit to paying shareholders the sale amount:
Following receipt of the first deferred consideration payment of US$10 million, to be paid within one year of the date of the SPA, the Company intends to pay a special dividend to shareholders of the Company at that time. A further special dividend may be paid to shareholders of the Company following receipt of the second deferred consideration payment of US$50 million, within four years of the date of the SPA. The Directors will determine the size of the special dividend at the relevant time.
$75m over four years? $30m over 10 years? RY must be sacked if thinks this is in any way an acceptable offer!
From RY and the board in the nearly three months since the “shareholder Q&A” in late November was the sparse RNS forced out of them by the press leak. I don’t know why I continue to be disgusted by AMC’s comms but I am - RY has a duty to inform us in a timely way of significant developments and progress or otherwise on talks about a buyout offer definitely fit that definition.
If, as announced, talks are taking place, then which legal firm and M&A specialists have RY and friends engaged to advise AMC on this? Surely they aren’t doing it all by themselves. Why does everything related to this appear first in the Times? Why doesn’t the board communicate?
From yesterday’s RNS:
1:,“The Company confirms that it is in discussions with a potential purchaser”
When did these discussions start? How far advanced are they? Why didn’t RY and the board inform shareholders about this fact before (accurate) press “speculation” emerged? Are they acting solely in shareholders’ interests as they are legally obliged to do?
2: “to sell its wholly owned subsidiary, Irosta Trading Limited, for approximately the indicated price. Irostra Trading Limited owns the Kun-Manie Project.”
Why are they in talks to sell “at approximately” the indicated price of £100m, when it should be clear this price is too low? What is the board’s view of this price, since RY wasn’t shy some years ago to say he rejected a “cheeky” offer? So is this a non-cheeky offer in his view?
3: How does this process relate to the TEO? Seems mighty suspicious that an offer comes along just ahead of final approval for this document - and what happened to RY’s pledge in August of timely updates? Gone with all the other promises of better communication with shareholders.
We are being led by the nose in the dark to a cheap backroom deal in my view - much more clarity required!
Yes, while the interest is welcome and long overdue, I wonder at what point RY and the board would have announced this approach if it hadn’t been for the press leak. He’s obliged to do so as soon as possible by market rules and yet the RNS clearly was forced by the rise in share price.
Agree - 7p a share doesn’t cut it for $25 billion-plus of asset. Add a zero to it and a deal would be done though
Yes, the inability of RY and co. to meet self-declared deadlines is what has really undermined confidence in them. Hope for better in 2022!
Actually the TEO was submitted in August and since then we’ve been waiting for this from that RNS.
“There is a calendar to completion of the work which is presently being finalised by the GKZ representative appointed to our Kun-Manie project. We shall revert once the schedule and key decision points are established."
RY in his pre-AGM q&a said he expected TEO completion in the fourth quarter but we have nothing so far confirming that. So we wait..
It also states the company has until Dec. 1 2022 to complete the TEO? Did they just push back the deadline again??
Can’t see what else explains the 10% rise today.
Russia starts 10 days of holidays on Dec. 31 and AMC has to RNS in London, so realistically Dec. 23 is the last day to TEO in this quarter. And who’d be paying attention then in the market?
Twelve trading days realistically for RY to make good on publishing the TEO in the fourth quarter. What bets on him meeting this deadline? And really it should be next week if he wants to gain any proper market attention.
Yes I have my ideas but the sp was over 20 six months ago and I’m puzzled why it hasn’t returned above that level. It should be 25p on the back of today’s results and the prospects going forward.
Hi - lth here since 2p days but first-time poster and have long enjoyed reading this board. Very impressed by these results which show Jubilee’s mcap is now just three times revenue. It’s clearly hugely undervalued but what is your assessment of what the sp should be after these results? Just trying to get a sense of where this should go to.
The impression I was left with is that the TEO (probably) will be completed next month and then it’s not at all clear what RY plans as next steps. He seems to be waiting for someone or something to appear and take it all off his hands once he’s done the paperwork. That weird last response about hostile takeover suggests he knows who they would like to partner up with before kicking back and letting others bring it to production. Just my take.
That’s a very good set of questions - hope for some answers. And to know why the BoD has been so passive in marketing Kun Manie to potential partners, at least from the nothing we are told. The AMC communication policy has been reliably terrible for years - “right time, right place, right product” anyone?
It just means RY has nothing to tell us about the past year so he wants to spend as little time as necessary telling us nothing so that he can get back to doing nothing.
I’m not sure any longer what fingers are crossed and waiting for. What do any of us expect to hear from RY and the board before the end of the year. They literally do nothing publicly to promote AMC at a time when demand for nickel resources is soaring. I know hope springs eternal but it’s not actually meant to be an eternity.
“It is the Company's belief that the successful completion of a binding offtake agreements will provide access to institutional investors providing financing options for BFS programme and any associated work.”
This has been the company’s belief for years but the reason the sp is going nowhere is the BoD has provided no evidence they’re anywhere near to delivering on their belief. No explanation of course of AH’s departure but at least he gave the impression he was capable of doing that.