BHP still has the right to appoint a director, provided they maintain a 10% holding in Solg.
SSA refers to the Share Subscription Agreement dated 16 Oct 2018, which is available on SEDAR (filed 25 Oct 2018). The "standstill agreement" is just a part of the wider SSA, and is limited to a period of 2 years.
The right to appoint a board representative is set out at clause 6.1 of the SSA. It is not time limited and therefore BHP still has the right, provided they maintain a 10% holding.
The standstill period may have come to an end last year, but the rest of the terms of the SSA are still valid and binding imo.
Bijar and BBG who also mentioned it earlier - yes the Noront situation is quite interesting at the moment.
https://www.mining.com/bhps-noront-bid-hits-impasse-with-wyloo-refusing-to-budge/
The BHP offer premium to the SP for most of this year doesn't look too bad either.
Someone should remind the people who like to "sell the news" that you are meant to "buy the rumour" first...
Nice RNS this morning. As far as I can see the various results that have been coming in are doing exactly what the company intends them to do, showing hopefully commercial deposits that will likely be desirable to miners like IAM who will want to develop them. Just need patience here for value to play out.
Thanks for the info. Very interesting. If all is as the company is implying, it seems to me this really has the potential to be as big as we all hope, IF Solg play their cards right. And also it will take patience and a few more years to realise the really substantial gains in SP that we all want.
David a few days ago: "They seem to have no defined strategy"
That's not true though. Their defined strategy is 1) develop cascabel, by issuing PFS by year end, sorting financing next year and aiming to begin construction of the mine in the next couple of years, 2) continue to prove up other priority targets with multiple drill programs and aiming for Porvenir MRE sometime fairly soon and 3) seek JV arrangements for 20 non-priority targets, with DD currently underway.
There is a defined strategy, it just might not be the one that everyone here wants who are looking for a quick exit at 55p.
Zoros why don't you ask Wazza if he thinks 50p is good value for Solg? Assuming he says no, why are you so keen to sell out as soon as the SP hits that level?
Surely you can see there is much more value in Solg than that, I don't really understand why you're so desperate to sell out at that point.
If BHP made a formal offer tomorrow for 50p I'm sure the board would not recommend it on the basis they'd say it undervalues the company. Mather and associated entities would refuse it so that's about 20% rejections from the get go, I'm sure a few other PIs and smaller funds would reject based on the board's lack of support. If they all came out and said they were rejecting it, it'd be in the interests of NCM, Blackrock, Valuestone etc to reject as well because then it is clear that BHP want the company and they are not going to want a take up rate of barely 50%... If they bid for the lot they will want 90% and compulsory squeeze out no?
I think Solg was caught in the downdraft of the mining sector generally over the last month or so. Sentiment on gold miners was at rock bottom a few weeks ago. PMs took a bit of a beating despite favourable macro tailwinds, markets somewhat tying themselves in knots trying to figure out inflation vs deflation expectations, likelihood of tightening, dollar breakout or continued downtrend etc... Miners were looking like they'd been repeatedly kicked in the gonads despite the fact that even at $1750 gold and $25 silver most will be making money hand over fist. Copper also wobbled but long term there's simply too much demand and not enough supply so prices are only going one way in the medium term IMO.
I think as the sector picks up now and PMs and copper are picking up Solg will run back up into the 30s again as we await news. Well, I hope anyway.
Looking at the last two Blackrock holdings RNS, the financial instruments they held are listed as Securities Lending. I assume this means they have lent out Solg shares under an SLA with title transfer. Since they have the unconditional right to receive the shares back at the end of the stock loan and assuming the borrower doesn't intend to exercise the voting rights then any loaned shares would still be disclosable by Blackrock in the aggregate holdings - it was 4.92% held outright and 0.08% via securities lending for a total of 5%. This is probably just part of their BAU stock lending operations to boots fund returns or offset management costs... The borrowers of stock are normally borrowing to short though so make of that what you will. It's a tiny percentage of the total shares in this case.
Speaking of CFDs and spread betting, I have wondered if some of the blocks we see on the order book are the spread betting companies hedging themselves. I think they try to hedge their books internally if possible, offsetting customer longs vs customer shorts. Obviously only possible if there is enough volume on the book in both directions and if they can't do that I assume they hedge themselves in the market by buying and selling the underlying shares.
BNC pointed out that you can't short Solg on IG, so presumably they have to hedge all their customer longs in the market. Knowing how Solg trades I wonder if there are a lot of day traders who trade Solg via CFD or spreadbetting and set limits to capture the gains of any spikes. Could these large blocks at round number prices above the market price be spread betters hedging?
People seem to forget that if it wasn't for the designated market makers, there wouldn't actually be a market in half the stocks people here invest in. The volumes on a lot of these smaller names are pitiful. Try selling your investment when you need to cash out if there weren't market makers willing to make a bid to you every day.
Obviously they have to make a profit as they are not charities. But if a market maker was bidding 27.9p this morning and now they are only bidding 27p and no one is bidding higher than that then there we go, that's the best price anyone is willing to buy your shares at. If there were loads of people bidding higher than that then you'd get a higher price but clearly they aren't.
Short term and intraday price movements are just noise. The market makers don't arbitrarily decide the price just to screw over PIs, the market ultimately dictates the price and the market makers are a large part of that market for low volume stocks. If investors were falling over themselves to get their hands on Solg shares then the price would rise but obviously they aren't right now, or at least not so much that the price rockets to the moon.
I'd rather have MMs making a market so I know my investment is liquid if I ever needed to get cash out rather than buying some tiny illiquid name where you can't even get a bid most days.
And let's face it, if you think MMs are deliberately suppressing the price so their hedge fund mates and clients can load up on the cheap, then great! So can we! And why would they be loading up in the first place? Not just so they can watch their investment stagnate while their market maker chums sit on the price forever. If you really believe an evil cabal of banksters and hedgies are loading up on the cheap then that's actually a good thing.
Personally I don't believe that, I think the market just doesn't value Solg at much more than £600k-£700k until it delivers Alpala PFS, funding package, more amazing regional news or some sort of corporate action. Until such time as those happen, the SP waits.
Red, what's even more ridiculous is Miagi getting banned for a week from LSE for posting on the GGP board that it was overvalued and people buying at 35p+ might lose a load of money. Apparently telling them it was massively overvalued was disruptive, abusive and not the type of thing that's allowed... I pity the people who were putting their entire SIPPs into it at those prices, even though it's an idiotic thing to do in the first place.
Isn't it possible that everyone ends up being right, if Solg are planning a JV with, let's say, BHP in order to take Alpala to production? Solg have first refusal on CGP's ENSA shares, maybe the agreement they have come to is that they won't stand in the way of BHP acquiring CGP's 15% of ENSA as part of the overall JV agreement. CGP get their long awaited exit and payday. BHP takes another 60% of ENSA shares off Solg's hands for a juicy sum and then then become 75/25 JV partners in ENSA. BHP does all the legwork and financing is sorted, and they get 75% of a 55 year mine supplying their future facing metals. Solg rides along as 25% JV partner, so still technically fulfilling their aim of becoming a producer while in reality not actually having to build or finance the mine themselves. Rinse and repeat for the next mine at Porv or Rio or whichever.
Why don't BHP mind about JV'ing the 10 low priority targets? Because they already have more than enough on their plate through all of Solg's other priority targets. As mentioned Alpala should be a 55 year mine. Porv and Rio and the rest have potential to be decent mines. How much exposure to one country does BHP realistically need? They want to run a tight ship, they are already the world's largest miner, maybe having a stake (through Solg) in a load of low priority targets that are well over a decade away from ever becoming a mine just doesn't add any value to them. So they are happy to allow Solg to offload them and focus on the priority licences instead?
Serious question - should Solgold change their name? To remove the gold bit and make it clear they are a copper play? It sounds a bit silly that the name should matter more than the fundamentals, but we see time and again that markets and many investors are silly. When a fad takes over, anything with the right name gets a lift. And look at the recent examples of the wrong stocks getting massive price increases just because their names sounded similar to the stocks people were trying to buy.
On a more serious note, if there are people out there (rightly) identifying the massive need for copper as an investment theme and searching for plays on that theme, surely having copper in the name would at least put the company onto more people's radar up front.
https://www.reuters.com/business/energy/mining-giant-bhp-offers-buy-canadas-noront-resources-258-mln-2021-07-27/
BHP getting stuck in with a rival bid for a nickel/copper miner at an almost 70% premium to yesterday's price. Lots of focus on future facing metals.
Regarding news, I'm sure I remember for most of the first half of last year everyone was desperately asking for news, then in the second half we had frequent news releases as part of "shock and ore" and because the SP didn't rocket to the moon everyone was saying the company had overdone it, the constant news releases were just hype from Mather trying to save his skin at the AGM etc. Everyone was demanding a calmer, more professional approach. So at the start of this year Solg clearly stated that they would be releasing news less frequently from now on, not hole by hole, and would consolidate things into wider updates (of which we have had 4 already in 2021). Yet now people are moaning that there isn't enough news and news is being "suppressed"? Come on.
Blackrock are massive. Their funds own significant holdings in virtually every large cap developed market stock in the world and thousands of others too. I don't think it's in any way possible there is some centralized, co-ordinated trading activity around a tiny name like Solgold.
Solg is included in a various of their iShares ETFs as well as a few of their actively managed funds. They will not have autonomy over every buy and sell decision, a lot of them will be dictated by inflows and outflows into the ETFs and funds meaning they have to buy more or sell some of the shares in the basket. Also if the indices the ETFs track rebalance their baskets then the ETF has to also rebalance.
The task of trade reporting, regulatory filing etc must be absolutely biblical at somewhere like Blackrock, no wonder some clerical errors were made. I was involved in the implementation of trade reporting and pre- / post-trade transparency disclosure when MiFID 2 came in and it was virtually impossible to get right from the start, as was acknowledged by the FCA who expected a best efforts approach. The FCA were unable themselves to figure out exactly what some of the requirements of MiFID 2 actually were or how they should be applied.