Member Info for rcgl2

BNc your 7.48 post I totally agree with and recommended. Those are the facts.

Your 9.22 is just speculation though. For all these theories about BHP wanting to get this on the cheap, the facts just don't support it. We know what shares they have bought because we are always told when they participated in a placing. In fact if you look at the large stakes they acquired a few years ago they were willing to pay a premium and accept a lock up.

From the horse's mouth:

"BHP has agreed to pay 45 pence per SolGold share, which represents a 32 per cent premium to the 20 day volume-weighted average London Stock Exchange price of 34 pence per share as determined on 15 October 2018."

"BHP has agreed to pay 22.15 pence per SolGold share, which represents a 9.3 per cent premium to the 20 day volume-weighted average London Stock Exchange price of 20.26 pence per share as determined as at last close on 22 November 2019."

Of course they'd rather pay as little as possible for any acquisition, but I just don't think it's plausible that one of the world's biggest mining companies is going to engage in shady market manipulation to suppress the share price of a target. If you spot suspicious transactions in the closing auction (someone offered 200,000 shares 0.5p below the bid, shock horror!!) it's much more likely to be some wannabe Hound of Hounslow sitting in his parents spare bedroom thinking he's a trading genius. It's not BHP fiddling around over pennies. If they really wanted to tank the share price they wouldn't have laid down a marker of 45p a share a few years ago.

"Due diligence is being done now"

Source for that? Other than your own wishful thinking.

If someone is acquiring the whole company the DD isn't just limited to assessing what's in the ground and the economics of extracting it. They will also need to do all the other stuff like tax, corporate subsidiary structure, checking all the licences, permissions, authorisations etc making sure nothing adverse is triggered by a change of control, all the employment law stuff around employees in Aus, UK and Ecuador, pension arrangements, office and other real estate leases etc etc.

Is a lot of this stuff mind numbingly tedious for all the juniors who have to trawl through everything and compile all the DD reports? Yes. Does anyone realistically expect that the deal will be abandoned by some minor employment law issue? No. But there are best practice processes that should be followed so it's extremely unlikely anyone is going to make a bid that isn't conditional on DD being satisfactorily undertaken imo.

It's not clear how much of this could be done in advance, depends if Solg is running a data room and giving access to anyone I guess.

There are examples of takeovers where DD was either not done or wasn't done properly, usually as a result of hubris and ego. RBS's consortium taking over ABN Amro is a well known one, which basically bankrupted RBS.

So despite people complaining that they hadn't heard from DC, shocking lack of news etc etc, it turns out that in his first 2 months in the job he's met with NCM, met with BHP, met with CGP, flown to Ecuador and visited the sites, met with President Lasso and other Ecuadorean representatives, has now flown to London judging by the decor in that hotel room, and is now doing a series of print and online media interviews with plenty of things to talk about and a pretty coherent plan for how he wants the next year to unfold. I think he's doing ok.

Thanks for posting it. I thought that's a great interview and DC clearly knows exactly what he's doing. Feeling pretty confident after reading that.

RK that seems quite punchy loading up on POLY before seeing what any sanctions might look like, if they come. I know they say buy on the sound of cannon fire, but the cannons haven't even started firing yet.

I agree though, I think PMs should go higher if it all kicks off. They seem to be a bit like catapults, they need to be drawn back first before launching forwards rapidly. I think it's just selling for liquidity when other markets are tanking that causes gold to drop alongside equities at first, then hopefully off it goes in the opposite direction... Although I am a bit disappointed that silver's breakout from the end of last week seems to have been bashed on the head.

Not worried about anything Solg specific, I don't think this drop has anything to do with lack of news, the CEO, the colour of their wellies or anything like that. Think it's just a case of being caught in the downdraft of the wider markets.

TheItalian, enjoyed reading that post, thanks for sharing.

Yes there must be situations sometimes where as a result of a corporate action, shareholders receive something that isn't ISA eligible... you would hope you'd get the option to have your broker sell whatever it was on receipt and deposit the cash into your ISA, otherwise it would be unfair in terms of the tax treatment. Anyway, hopefully not a situation we will have to worry about with Solg.

BHP shares will continue to be listed on London under a standard listing after the consolidation of the dual listing structure. It will just lose its premium listing on London, and the Australian listing will be the primary listing. So we should still be able to hold BHP shares in our ISAs. No reason they would become ineligible.

Hi Damers - yes agreed, in an article about BHP's push to get M&A deals done the mention of "its years long chase of the copper developer" is very good. It's a shame though that they framed it in reference to internal squabbles, which makes Solg sound a bit of a mess imho.

Anyone interested in the energy transition/electrification theme and looking for copper plays should have Solgold top of their watchlist. Not only does it have a huge Tier 1 resource but it's also a prime target for a takeover by the likes of BHP, coming fresh off the back of the Noront fireworks which resulted in a massive uplift for their shareholders. This is exactly the kind of high reward junior investors should be looking at with anticipation.

Would be great if Solg and their advisors could get that message out there! Enough of the boardroom shenanigans and public spats, Solg needs to get on people's radars as a prime copper play in a booming copper market, not as a messy small cap with governance issues.

https://www.bnnbloomberg.ca/bhp-revives-appetite-for-deals-with-biggest-rivals-in-sights-1.1709236

Looks like they have some much bigger beasts in their sights. Solgold gets a slightly disparaging mention near the end...

"BHP has also been dragged into internal squabbles at SolGold Plc during its years-long chase of the copper developer."

Lol Sherlock

I've seen it stated on various occasions over the last year or so that there are long lab delays and assays are taking months to come back in some cases. Considering we just had the Christmas holidays and also that normal working patterns are once again being disrupted by the Omicron wave, I don't think it's surprising that more assay results are taking a long time to materialise. I'm not reading anything into it other than that.

I just think that the SP isn't going up materially because nothing has happened to materially increase the value of the company. Obviously the drills are turning and more resources are being added at Porv, TAM etc, but as of today Solg has no way to access those resources because it doesn't have funding to do so. Every oz of gold added to the total represents what, $1,000+ of cost to extract it? Solg is basically valued at the current discounted value of what's in the ground at Alpala, plus a little bit for all the rest. To me it seems like what will materially increase the value of the company on a fundamental level is 1) derisking of Alpala in the form of PFS so that the discount is reduced, and 2) a clear financing plan so the prospect of turning the resources in the ground into profits can be values. In the absence of those, Solg's SP bumps along.

The outside factors of course are speculative excitement, usually after a new discovery such as 40p after first Porv results, or anticipation of an imminent bid. These probably drive the swings up and down within the range as anticipation builds and then ebbs away again. Until that bid comes in, we don't know what another party really values the resources at, so the SP is just left reflecting their discounted value in Solg's hands as of today.

All trades have to be reported so you would still see the volume regardless of the execution venue.

Yes I agree, it's extremely unlikely that Solg will take Alpala all the way to production on their own. Someone will buy the company outright, or each discovery will be sold off/JV'ed or something. I just don't think that a "secret deal" has been done in the background and it is rumbling on secretly for all this time... if they have agreed terms, why not just make the offer and get it done. Or announce whatever it is and allow shareholders to get the true picture of what is happening.

Just feels to me that even if we all agree an offer will come, it hasn't been agreed yet and as of today everyone is working to the plan as publicly stated.

Also there are a lot of examples of negotiated/agreed takeovers that clearly aren't in the best interests of the shareholders but which will enrich the current management through contractual bonuses etc, it's obvious what the incentives are. I am hoping that in Solg's case, Mather has such a lot of skin in the game in terms of his share holding that his incentives are actually much more aligned with ours and not just to agree the quickest, cheapest takeover possible to pocket his bonus. While he is still able to exert some degree of influence at board level I hope this means any takeover figure that might be recommended by the board will be way north of the current share price. Although of course this could also just be my wishful thinking.

Damers, I see what you mean but then why would they have even appointed Darryl as CEO in the first place if a deal was being negotiated to sell the company to BHP? They spent the better part of a year looking for a new CEO, why waste that time and effort if the board was negotiating a friendly buyout? Darryl has many skills on his CV but I don't think being parachuted into a company specifically to negotiate a takeover is one of them. In fact that sort of role is normally taken by a chairman isn't it? For example, look at Sir Nigel Rudd's career of coming in to chair companies and then selling them off.

I know some people will say well DC is BHP's man and they wanted him in so that he could run Alpala for them after they buy Solg out, but really to me the whole thing seems way too complicated and elaborate. If BHP were so keen to buy Solg at a price they can agree now, I think they would have. Seems to be a lot of wishful thinking behind people's views here. Occam's razor would suggest the reality is as stated, Solg are trying to fend off takeover offers and they appointed Darryl for his expertise in financing and managing major underground mining projects, which is what they intended him to do at Solgold.

Says the man who had some sort of mental breakdown about Quady and spent months threatening to take the board offline if Quady didn't stop posting!

Nice bait.

Blind Freddy told me.

Banned again, earthling? Back as Aoc71 now?

Cue denials...