Member Info for pickedpeck

Bwana - surely a net short has to take account of both shares held and short sold? I guess we will only really know later in December if that was the case.
Just as a 'what if', they saw the offer and short sold (without taking the subscription up) against the open market price? There were some meaty trades that first day.

I am definitely suspicious of the motives here too, the Saudis having more than a little vested interest in the EV market not taking off.

I agree they could hold it open, but the only point of doing so would be if they thought the price would fall further and make them more profit. As soon as the price starts consistently moving against them why would they hold it open?

Right now any buyers from the increased shares would have to be selling at a loss, that alone is likely to make the shares stickier than last time, but also the two main investors won't be selling any.

Seriously, if you were sat on that short would you hold it open now?

I am not worrying about it, I am speculating what the effect of buying 13million shares or so on the open market would be on the price. I agree it will go up, I suspect to back above the offer price.

Quite a few speculating that the 7p open offer won't be taken up. I agree it wouldn't if the offer closed today, or the open market price stays below the offer price.

But what happens when the Saudis close their short? Does anyone really think it will fall far from here? Why hold the short open now?

The current price is artificial and won't last, getting a price below the one Orion and La Mancha got is a temporary bargain opportunity, in a week the open offer may seem like a better deal. Personally I see the choice as buy now below the offer or buy later at the offer. I have already used the funds I would have had available for the offer and bought on the open market.

Bwana, glad to see you are still here, I had assumed you had exited tbh.

Interesting the PIs that post here that are into 8 figures. Craigie, Wasa, Strummer, Bwana, and me. Anyone else I have missed?

Individually not influential, but as a group not tiny, 80m + shares.

I agree rover, it does always feel rotten. It's even worse when they not only short but try and bring about a fall at the expense of others. The idea that there would be professionals whose task it is to swo discord and doubt is pretty nasty.

Yep, that's why we had negative newbies here over the last few days. Shorting based on uncertainty and then flooding BBs, Twitter and chatrooms with half truths and nonsense. Sadly a lot of people fall for it.

They are like parasites, that's why I got so shirty with a few over the last few days.

Good reason to split the equity raised so that no one has to make a bid. Orion still have some spare capacity should they wish to part fund Vermelho.

Their board member is an NED. Non-executive. They can stay as it is an elective position, they didn't have control of anything before.

Ivor - why would they? They are not a finance house, they are a miner. They want to use their capital to mine, not lend it to others. I know there was a lot of speculation about then being the cornerstone, but it's just not what they do.

A JV on Vermelho on the other hand is right up their street.

Ivor - miners work on decade long plans, 5 years is no time, that's classed as mid range planning in mining. Vermelho is the big prize here, battery grade premium product in a huge ESG compliant deposit. No one would willingly just walk away from that.

Soundbuy, I think they couldn't as they would have held more than 30% and had to make an offer.

Has anyone done the calculations yet for the percentage of the new company total shares Orion and La Mancha will hold?

Sasa - I know everyone is wrapped around the axle over the dilution, but have we really been diluted that much? Dilution always implies a reduction in the value of what you own, its a negative when a company does it to raise survival cash, typically more shares, same assets.

Here what's happened is somewhat different. The extra equity has been used to raise cash to create a more valuable asset. When Araguaia is constructed and put into production its value should be broadly in line with NPV. More shares, more asset value.

Bear with... But last week of you owned 1% of the company you owned 1% of an asset valued at £136m, £1.36m . Two and a bit years from now with the mine built and owning the same number of shares you would own 0.46% of the company but valuation now at NPV, say £1bn for easy maths, £4.6m. Lower percentage, higher valuation, higher asset value.

That's expansion not dilution.

Hazbeen - I think some of the trading over the last few days will have been finds buying up PI sales. Not in high volume yet, but there have been some meaty transactions about

Ivor - No.

No one knows what the share price will be as no one knows what the construct will be for the Vermelho project yet.

The share price would have to take account of finance, JV structure, debt, equity at the time, nickel price at the time, planned production level, plant needed and more. The DFS will help a lot but even then we will not know the share price.

We also don't actually know the NPV, the one we have been using is from the HZM PFS work done, but the DFS will really set out the nature of the investable project.

What we can do is speculate...

Planned production level 29 - 50Kt.
Capex required - $700 - $1000m
Ni price at production in line with wood Mckenzie $26k
50:50 JV with Teck as the construct, Teck putting up $600m+ towards construction for their 50% stake.

NPV smaller scale ~ $6Bn, larger scale $10Bn. Could be more with a more expensive / aggressive production plan.

I would take a wild assed guess HZM using a second equity round to fund their stake of Vermelho as well as more debt, but with Araguaia in or close to production that could be at 20p a share. Let's say for the sake of argument another 1bn shares for in round numbers 5Bn shares in total circulation.

5Bn shares, share price would include Araguaia value ($2Bn NPV) with $26k Ni and 50% stake in Vermelho ($3-5Bn NPV). That gives a share price of about $1 to $1.40, or 75 to 100p ish.

As you can see lots of moving parts, which is why no one actually knows. One thing I can say with a high degree of certainty when Araguaia and Vermelho are in production is the share price will absolutely not be anywhere near 6.5p.

Could you wait 5 years for a 10-15x return?

Rover - that's at today's Nickel price too. At the wood mckenzie forecast it is actually closer to $6Bn joint NPV between the two projects.

Nth - The company needs a JV partner for Vermelho, Teck could be that partner.

It's relatively easy to imagine a deal where Teck funds the majority if not all the mine build and then takes the product offtake whilst paying HZM a fat royalty.

More likely though is a JV vehicle jointly owned by HZM and Teck with both parties committing capex, but Teck being the constructor and operator for a larger % of revenue. That could subsequently be spun out or floated separately quite easily, nice business for HZM if so.

The trades that are mine are the 300k at 6.429 then 149,795 at 6.45 and 47,335 at 6.44. Just short of 500k.

Nope just here. I bought 300k, then two smaller trades.

Cracked and added. Just on 500k added.