Blencowe Resources: Aspiring to become one of the largest graphite producers in the world. Watch the video here.
Hi Redknight, I don't think they're down to 6% in Solgold, I think they're still at 7.5ish%. I think they're referencing their 15% direct interest in ENSA plus 6% indirect holding in ENSA via their 7.5% holding Solgold which holds 85% in ENSA... Hope that makes sense?
I think any funds raised to fund the CapEx required for the Alpala development will happen in ENSA... rather than Solgold. We hold 85% of shares in ENSA and I believe that, similar to us securing our 1-1.5% NSR with Franco through our Alpala holding, we will do the same with the equity portion (or at least majority of equity raising) for Alpala....
Some people believe the updated NPV from the PFS will be in the region of (let's be conservative) $8b (through CapEx savings, better recovery rates, better commodity prices, lower discount rate)... let's ignore the other tenements as there is nothing proven (yet) so Solgold is, at present is Alpala...
40% (as a guesstimate of what someone would be willing to pay) of $8b is $3.2b or £2.4b or around £1.10 per share... tax in Australia (especially for higher tax payers, of which mr mather certainly is one) for capital gains is very punitive... #justsaying
However if is it is a mix of cash and shares as part of the offer (e.g. from Barrick) maybe the tax isn't as bad...?
I can't see this going for less than a £ a share and don't think he wants to get involved in potentially messy JVs (and he has said as much multiple times)...to be honest I think this is going to production UNLESS we get an offer for £1.50+ in my opinion, which, I don't think will come unless we get multiple parties involved.... i.e. Barrick, Chinese firms and potentially Japanese investment houses.... But who knows!?!? GLA and DYOR
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Top video pal! Well worth a watch all, impressed by Barrick's CEO and plans... starts by talking about starting to think about copper and gold porphyrs..... then moves swiftly on - and yes increased FCF as I believe their plans all start with ensuring projects are viable at $1200 - anything above that is bonus. May need to rotate some funds into Barrick when Solgold is taken out for £2 ;) GLA and DYOR and watch the interview from today.
https://www.youtube.com/watch?v=3JvN_kOftjo
BN.c I believe that Solgold either want to use the Alpala deposit to underpin and fund the start of a Copper/Gold Major (through using FCF to fund other discoveries) or to be taken out for a significant sum that makes all shareholders happy. Solgold could sell their stake in ENSA but I don't think they would do so UNLESS they were further down the line with another discovery (or 2) so they could demonstrate the value case of the company AND the price paid for ENSA was significant enough to warrant the sale.
Currently Solgold is Alpala - there is huge upside, but until it is proven up the analyst price targets and valuations put barely any value on the regional tenements. Therefore if Alpala is sold we have a lot of cash (which one would hope some would be returned to shareholders) and potential, but would need the drill bit to pump the price.
The main thing I believe ALL Solgold shareholders should be worried about is if CGP manage to replace the Solgold board (less likely now changes have been made).... CGP have not had a bid except from Solgold... I think they know that another bid is unlikely and are worried about funding their $400m CapEx in the next couple of years AND the largest shareholders have been in it for the takeover, not to become a mine developer.
Imagine this scenario.... CGP replace the Solgold board with people they put forward, i.e. their allies. What is to stop them increasing the CGP offer to "fair value" or to renegotiate the ENSA agreement removing such punitive clauses as the dilution to 0.5% NSR that Solgold can buy out for $3.5m if they don't contribute to CapEX....
That is why, if an EGM does materialise, then all shareholders should vote, in my opinion, to retain the current board.... But this is all my own opinion and all should DYOR of course GLA
Adding to what you said rcgl2 it sounds like they've been engaging with stakeholders and major shareholders in the process of reviewing the board. My assumption is that they will use this process to ensure that the 3 additional non-execs that are yet to be appointed are (at least informally) signed off or endorsed by the very shareholders or financiers that they need to be on side....
This makes a successful EGM to de-seat the board even less likely!
Totally agree Pinot, they're running out of ammunition. Am glad to see that Corporate governance has been reviewed and is being strengthened, may bring CGP to the table...unless it is just a personal vendetta against Mr Mather, in which case it'll become very clear how unprofessional this attack and EGM to change the board is... GLA and DYOR
How about we split the role 50/50 and I spend half the week trying to sort out corporate finance deals for the mine and development and you spend the other half trying canapes and shouting at the hotel chef for not using enough truffles?
Bit better?
Here's mine Quady:
- Sell 35% equity in ENSA to big player using c$7b updated NPV from PFS as benchmark raising $2.45b at project level, potentially alongside some kind of cooperation agreement to use expertise from a BHP or Barrick.
- If CGP takeover is successful that leaves Solgold with 65% worth of costs to cover = $1.75b / 3rd party covers the other $1b
- If CGP takeover is not successful then Solgold covers 50% of costs at $1.35b, CGP covers their 15% at $400m and 3rd party covers $1b. OR of course we buy out CGPs 15% of ENSA for $3.5m once it is diluted to a 0.5% NSR when they can't stump up their 15% of Development CapEx.
- I'd use $1b-$1.25b cash of the ENSA equity sale alongside some streaming or offtake agreements and debt to cover our proportion of the Alpala development costs.
- That would leave us with between $1.45b and $1.2b cash. There would be some take I assume so take off say 40% (random figure and because I like to er on the side of caution) so we'd have between $870m-$720m in the war chest.
- Although not in Nick's nature (if you look at DGR) I'd pay 30% dividend so $261m-$216m (£205m-£169m) or 13p-11p per share which would give a lot of people a nice little pressie, alongside the clear uplift in share price.
- Leaving $609m-$504m in the warchest which is enough for all regional exploration and to bring one other project to development decision at which point, by that time, we should have some cash flows from Alpala to help with CapEx and continue to progress other regional projects through PEA/PFS/DFS etc...
That's how I'd like to see it play out...
That this is NCM working through CGP... Even the wording used is so similar... And NCM has a relationship with CGP via one of their projects... All in my own opinion of course but that is what seems to make sense... Especially as it's happened with such a focus on stopping the Franco Nevada deal...NCM would prefer Solgold issue 500m more shares at 20p to give them a bigger holding, dilute the rest of us and make us cheaper for takeout...speculation of course but seems to make sense with timing etc...
...will be for the Solgold Board with NM at the helm... he's led things well and the reason this has come about is because he hasn't been bullied into issuing around 20% equity in Solgold which would have diluted us to hell and given a large company like Newcrest the ammunition to buy us on the cheap. A 1% NSR is way preferable at this stage and looks after the needs of ALL shareholders. Bring it on I say!
Copperpot the discussions with the government are a standard part of the process to sort the final financial parameters of the project required for the DFS. These agreed terms around taxation etc form the basis of the Exploitation agreement required before development can begin (I believe). Most of the taxes laid out in the Mining bill are on a scale, and apply to things like money paid to workers, land owners, the local government, federal government royalties etc... Below is a link to the press release Lundin did when their EA was signed which outlines the importance of it and therefore the complexities and need to start discussions with the government early on with these kinds of things... Hope it's helpful and everyone is staying well :)
https://www.lundingold.com/en/news/lundin-gold-signs-exploitation-agreement-for-fruta-122521/
redknight1 they've been running seriously low on cash for a while now so they've been selling bits and pieces of the shares to keep the lights on. 12m or so over the past 6 months ain't enough to suppress the share price.
Hey BNc, still around, but more of a lurker with a focus on family (got a 6 month old), and trying to only dip in when there are material things to mull over. Still invested (balls deep) and looking to see how this story unfolds. Hope you and yours are well. GLA
Following on from what you put Iceberg:
https://www.fool.com.au/2019/07/10/citi-picks-the-next-big-mining-ma-play-on-the-asx/
"This makes Fortescue the best performing large cap miner but it may need to make a sizable acquisition to lessen its dependence on iron ore if it wants to stay ahead of the BHP Group Ltd (ASX: BHP) share price and Rio Tinto Limited (ASX: RIO) share price."
With roughly 2 billion shares outstanding (including options at 37p and 40p) you're looking at around 50p buddy. I don't agree with it I would hasten to add, looking well north of 60p as benchmark, but that's just my perspective