Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
Oofy: "You may in any case take the view prevalent on these AIM chat boards that you haven’t got a loss until you sell your shares."
As a 'PS', I don't take that view, as it happens. But I'm not on a loss here, if that was your implication.
Oofy: I don't see what point you think I'm missing but I'll reply to the rest very briefly.
1. "What difference does it make whether the real estate asset was put up by a Vast shareholder?"
Good research has been done as to who this most probably is and, if correct, the party is in a strong position to make enforcement by a creditor very arduous.
2. "As far as I’m aware, the offtake agreement with Mercuria ended in April 2022."
I'm sorry but this is just lamentable lack of research. Mercuria remains the offtake partner.
3. Agreed the sums are currently de minimis but they can be projected to grow as mine performance improves. Mercuria has a long history of being patient with the debt - well before the most recent piecemeal extensions - and, being the ongoing offtake partner, is likely to continue to work productively with the company, particularly now that BPPM has at long last shifted to being a going concern as regards normal opex.
4. Entitlement to enforcement of covenants begins on 1 March 2024, not before, though this is likely superseded in Mercuria's case if an ongoing payment plan is satisfied. But your fixation on Mercuria is in any case predicated on having completely misconstrued their relationship to Vast by being unaware that they are still the off-taker.
5. Yes, Alpha's loan is indeed a bullet loan. And, not having a commercial interest in the mine, they are less incentivized to be patient with the company. The pattern of short-term extensions since May 2023 was never Mercuria's past practice, who previously did 1-year rollovers for a flat fee. The change smacks very firmly of Alpha.
Oofy: "Sandy: you’re pretty rude, you need to read what I write."
My tone is carefully calibrated to match the persistence of your (sometimes deliberate, sometimes ignorant but opinionated) errors and omissions, and your repeated presentation of your negative speculations as if they're obvious fact.
So I'd say that I'm being quite polite to you, all told.
Next: I did not simply repeat what you said. You said "Someone has put up a valuable real estate asset" but missed the point that the party acted as a Vast shareholder - a detail I provided in reply.
You also seemed to be blissfully unaware that Mercuria is the offtake partner, which I also kindly brought to your attention.
Furthermore, you remain muddled over the collateral arrangements, having fibbed about already being familiar with the RNS to which I helpfully pointed you, even though recent prior posts of yours made it obvious that you were unaware.
Next: "And the “payment plan” appears to have been missed so far." This is a flatly without foundation - but characteristically doesn't stop you. There is no evidence for that. If you knew the RNSs properly, you would know that the plan is for payment from BPPM concentrate shipments - and there is absolutely no foundation to suggest that these have not been happening in Q4. In short, you preferred up another lie.
And: "I’m not going to keep answering these unpleasant posts of yours". Well, the sooner you stop trolling the BB with falsehoods, the sooner I can stop calling you out for it.
Oofy: you obviously still don't get it - or have no interest in the facts.
Seniority of security over BPPM goes to the shareholder who provided the Bucharest real estate collateral in the first place.
Mercuria (those "very smart" people) only have secondary security over BPPM. And Mercuria's finance is the offtake finance because it's Mercuria who are doing the shipping for Vast. They get revenue from the mine from their offtake cut. Plus they now have a payment plan for their part of the finance itself.
You might like to consider not making a complete prat of yourself in your comments.
PS. re your comment: "More likely, perhaps, is something like the imposition of big royalties on Vast’s future turnover from its mines, such that existing shareholders will be looking a very long way into the future for a return on their investment. The lenders have got Vast over a barrel, it’s they who will make the decisions next month."
That's not how a commercial debt restructuring works. There is no agreement unless the company signs it. Anything that comes by "imposition" would be court-ordered. Courts will consider all stakeholder interests: creditors and shareholders.
* does NOT always report ...
Oofy: I'm happy to disagree.
But while you're here, I recall that you had overlooked the most important and relevant RNS on finance, which is why you've been in a muddle over the creditors. Unfortunately, this website does always report every RNS. I don't know why. A glitch, perhaps, somewhere. So it's best to go the official London Stock Exchange site.
The RNS you need is here:
https://www.londonstockexchange.com/news-article/VAST/repayment-of-atlas-special-opportunities-completed/15453624
It should help you to understand things a great deal better.
IG: my judgment call in January 2023 was that the company would survive that year, even though it was thought by some (as it often has been) to be at death's door. The subsequent 12 months have seen the business fundamentals strengthen.
At the core, BPPM's normal opex has stopped being a cash guzzler and has probably moved into profit (subject to what we see in the Q4 report - but they already had a hefty stockpile on 30 Sept.) The placing is about capex to develop it further.
The additional developments in Tajikistan and with PGM, though not immediately high-impact, show a maturing and diversifying business.
I'm not surprised about the 'historic parcel' being delayed: I recalled at the outset that it took around 5 years from a court judgment to get the BPPM licence. It is what it is. AP sounded buoyant today but then he was like that for years about BPPM. It lands when it lands.
As regards the creditors, there's a payment plan in place with Mercuria (which I'm sure will evolve to higher numbers). I've often said Alpha was more likely to play hardball, and it's certainly true that the latest debt update contained a change of language. But that situation is not, to my mind, as threatening as some think. (1) Action against collateral might not be Alpha's immediate next step: Vast is their first miner as they're real estate specialists. But if they're interested in the mining space in future, they'll need to be accommodating or no one will touch them. (2) I've said before that the court process to enforce on collateral, if they do start, will grind for a while. You can't take over possession of a €9m asset in Bucharest (probably a boutique hotel) with the knock-on effect of imperiling some 300 mining jobs and a flagship venture in the revival of Romania's mining industry, merely on a breezy nod. It would get jammed by Vast for long enough, IMO through injunctions and appeals, and the slow nature of court scheduling, to find a different solution. Alpha might well not bother, or go through the motions with a view to accepting an alternative.
So I think we'll still be discussing Vast in January 2025. Probably with a debt solution and better cash flows. You'd imagine with a better m/cap and SP too.
Just IMO.
ASI: the BPPM expansion costs are not normal mine operating costs, so I think the normal mining operations (salaries, energy costs, equipment maintenance etc.) might well be in profit. But drilling and development work is still classified as capex, I think.
Steward: re your 09:14 - "Strangely, I think that this placing shows that VAST isn't going bust!"
Exactly. People have predicting the demise of Vast for years. Certainly since I've been following it from 2016. But it never happens. And the purposes for the money today don't say a word about placating creditors. Why? Because developing the business is a higher priority. Tells you what you need to know.
Pecten: re your 07:29, spot on IMO.
Oofy: again lying. A legal extension is a legal extension. That's not "to bandy words", as you put it with characteristic falsehood. By all means do stop indulging yourself. Why not wait for the five and a half weeks instead?
Good grief, Oofy. Someone really did give you a spade for Christmas. It's quite pathetic how much attention you're lavishing in your relentless negativity and inaccuracy about a share you don't hold.
*your, not you're, in my last line prior.
Oofy: you insist in going from bad to worse.
1. The SP does not necessarily need to rise for an alternative solution to the debt to appear. The SP would only need to rise if the solution is to cover debt via an equity raise. The company might instead secure other debt finance.
2. Yes, the wording of the recent debt update was different. But the debt, contrary to what you said just earlier, is not overdue yet because there is a legal extension in place (and then a grace period). So, let's get it right, shall we?
3. "And in any case, the final phrase “finalise ongoing repayment initiatives” refers to the parcel of diamonds."
No. To repeat, you're wrong by insisting that this is the only meaning because, as I just said, the company has previously indicated that it pursues alternatives. The fact that you apparently missed that company statement is neither here nor there.
4. "announcements which exclude the source of the commodity it claims it will be intermediating for a commission and the name of the Swiss investment company who has given them this contract don’t somehow carry much weight."
As I just said moments ago, it should be obvious that the source is currently commercially confidential. It seems that you're just not very experienced at reading RNSs and picking things like that up. Are you alleging that the commercial information in the RNS is false?
5. "Re your point 1. the distinction is irrelevant, any discussion on this would be mere bandying of words."
Wrong again. You said the debt is "way overdue". It is not overdue when there's an extension in place. You broadcast again you're poor grasp of what you tend to dismiss as bureaucracy.
Furthermore, as regards Oofy's notion that something is "missing from the RNS", readers will have noticed that, although we have name and identity for Dubai-based Nikash group, the party on the other side is referred to as "a Swiss investment company".
What is obvious is that the identity of the source of the PGM product currently remains commercially confidential.
Oofy: wrong as usual. You wrote:
"Vast have admitted on numerous occasions that their ability to meet the terms of their loans, which are way overdue, depends solely on the receipt and sale of their parcel of diamonds."
The recent debt update stated:
"The Company has now concluded legal documentation for an extension to 31 January 2024 with a further period of one month to 29 February 2024 to effect repayment prior to the creditors having an ability to commence any enforcement of security so as to allow the Company to finalise ongoing repayment initiatives as previously announced."
1. Debt is not overdue while extensions are legally in place.
2. As was recently mentioned on the BB, Vast has elsewhere indicated that it continues to pursue other avenues besides the diamonds.
Oofy: I understand your numbers and I agree that the question is worth asking. But that is what research is for, which is rarely achieved by asking on a BB.
Your earlier post offered a characteristic Oofy dose of cold water:
"how are Vast going to find 2 tones per month? And why would anyone want to use Vast for such a purpose? Or is there, as Dorothy Parker is alleged to have observed, less to this than meets the eye?"
... with the obvious question tacked on at the end:
"Maybe there’s some more platinum being produced somewhere else?"
***
So, let's look at that. Note the following RNS phrase:
"As part of this arrangement, and on behalf of the Swiss investment company, Vast has received an offer from the Nikash Group to purchase PGM concentrate containing on average 15% platinum plus other payable materials and which is being marketed as a platinum concentrate. Under the offer, Vast will arrange the sale and delivery of, on average, two tonnes of high-grade platinum concentrate per month over a period of up to one year."
1. Does it not occur to you that the Swiss investment company and Dubai-based Nikash group have already thought about access to volumes?
2. Does it not occur to you that, in the conduct of due diligence, given that contracts have been executed, they have satisfied themselves of the reasons for engaging with Vast?
3. Assuming that neither the Swiss nor Nikash forgot to ask those questions - though perhaps you think you know better than they do - does it not occur to you that the answer to your two final queries is that (a) no, Dorothy Parker is not correct on this occasion; and (b) yes, there is a recognized source of the contracted quantity that might not be immediately self-evident.
Or possibly you really do think that the Swiss investors and Nikash group are both bumbling idiots who performed no due diligence at all.
Oofy: "I realise that the contract is for concentrate, and PGMs, not just platinum".
You've answered your own question. Platinum is not the only constituent of "platinum group metals". The clue is in the name.
But let's face it: you're not here to do research that takes minutes. You're here for your latest de-ramp.
Yawn.
Oofy: "Where in the EU are PGMs produced?"
Primarily Finland. Basic research.