The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
I checked across and FCR is trading today at roughly half the September 2016 acquisition value by THC. If I am right that Toral/Lago (the Spanish assets) are its main assets, FCR is perhaps rather like MAFL in that most of the potential real value (i.e.potential for significant upside) is dependent on the outcome of drilling programmes and is no doubt yet to be reflected in the sp?
I agree with 6zeros, FCR has been battered and I believe FCR has announced it is now concentrating on its sole or main assets, i.e. those Spanish mines bought from THC a year ago. There seem to be good prospects of those turning out to be a worthwhile resource, IMO.
From RNS of September 2016: Pursuant to the terms of the previously announced option and sale agreement, Ferrum Crescent has paid £565,000 to purchase this asset. The sale price is comprised of £326,500 cash consideration to Crestgate's wholly owned subsidiary, GoldQuest Mining (Spain) Corp. (the "Vendor"), from its existing cash resources. In addition, Ferrum Crescent is issuing 100 million new ordinary shares (the "Consideration Shares") of no par value each in the capital of Ferrum Crescent to the Vendor in settlement of the share element of the consideration. The Consideration Shares represent approximately 6% of the Ferrum Crescent's enlarged issued share capital with a current value of £240,000. Additionally, Crestgate will be entitled to nominate one director to the Board of Directors of Ferrum Crescent. MAFL retains its belief in the value of the Toral and Lago assets and as such intends to remain as a long-term shareholder of Ferrum Crescent.
It's a valid opinion that MAFL's interest in LS might become more than 49%. Clearly MAFL is funding THC's drilling on terms which we do know likely consist of secured loan notes. Any other related terms are not published but, for instance, the LNs might be convertible. Guess all will become clear in due course - just another possible strong positive for this stellar share. IMHO. DYOR etc
It is a while since Only1 was here to post his list of the fundamentals of MAFL - but it is always worth remembering that MAFL is about far more than just Lagoa Salgada. LS may be the biggest, likely by far the biggest, jewel in its crown but there are a few other gems in the crown as well, apart from its more general objective of looking at "other opportunities", which JV seems to be rather good at finding. That is mostly longer-term stuff but of relevance nonetheless. DYOR, GLA etc
Nom: Understandable confusion! JV boss is highly experienced and I think we can rely upon him to be pragmatic and resourceful (excuse the pun). The Spanish deal, the buy-in of the government stake and a potential doubling+ of the resource are all examples of how he deals with matters, quite apart from the meaningful skin in the game which he holds.
Ma5k/U69: Whilst it could be a cash or cash/shares sale (agree no JV as such), IMHO, the Spanish precedent may be an indicator of a preference for the cash/shares opinion which, as M says, provides an ongoing stake. But so many potential variables here - e.g. a non-quoted purchaser would not have liquid/marketable shares, any purchaser may prefer paper to cash, a royalty structure might be negotiated etc etc. I do not believe anything has been said by the bod beyond their looking for a sale/JV partner to exploit the resource. DYOR etc
UB69: Just bear in mind that the next hole is only number four. Given the lack of any real impact of excellent results from the first three (and indeed the 4 before that), we may have to await at least the full 6 and the overall geo assessment of the resource before anything starts to turn. Maybe also require a sale announcement. Who really knows what it will take to get this sp to where it deserves to be!! I am not a chart follower so base my views purely upon the excellent stock fundamentals and what is expected ahead.
As its still holiday season and a while too before the next drill result, anything could happen to the sp. But with some substantial buys over the last week or so, maybe some stake building is going on? Frankly, if you believe in the real unrealised value of MAFL and re-rating ahead, it makes little difference to the end result whether you get in at 9p or 11p, IMHO. Particularly given the oft reported liquidity challenges in this stock, it may perhaps be better to buy when there is some liquidity around? Just a thought, not a recommendation! DYOR, GLA