Roundtable Discussion; The Future of Mineral Sands. Watch the video here.
I think AA should offer 5.5p plus a royalty to us shareholders say around 1 - 2%. At least this way we all remain in the project and reap the rewards in the long run.
What's everyones opinion on this?
Does anyone have a list of the II's which are still buying, so far I'm aware polygon have 8.5% and vanguard at 3.19% - both have been increasing their positions. I'm still holding until i know for sure, these guys have a motive to increase the bid or help get the funding sorted.
Our best hope is the consortium further revise the 'conditions'. They seem to be keen to invest so I hope they can change the conditions to change the BOD's minds. Its so stupid that there is a clear way forward here but the BOD's have rejected this and are happy to accept 5.5p? I read on the RNS that they were discussing a 'minority' equity with the consortium's, but this to me sounds less than 50%. even it is just 50% this is better than taking a 5.5p buy out. even if they did give away 50% that would be 15 billion shares in issue without consideration of the convertible bonds. Say after 5 - 8 years we are at 10- 13 mil tons a year that would still give us £8 billion valuation (50p per share). Am I missing something here??
'The most advanced alternative proposal was a potential debt financing proposal from a consortium of financial investors. In December 2019, Sirius received a non-binding term sheet from the consortium to form the basis of a US$680 million funding package to cover the initial scope of work. On 9 January 2020, Sirius received a revised non-binding term sheet from the consortium. The Sirius Board reviewed the proposed terms and conditions, together with its advisers, and concluded that the consortium's conditions and the time it would take to meet such conditions were such that there is a very material risk that the overall funding package would not be implementable by the end of March 2020. Based on the backdrop of the search for a standalone funding solution undertaken over the last 4 months and the extensive discussions held during that timeframe, the Sirius Board believes that, at this time, there is not likely to be an alternative to the Acquisition other than administration or liquidation.'
1 thing I don't understand is why Anglo is bragging so much about how good of an asset Sirius is. If i were in their shoes, I would keep quiet and play down the projects potential to avoid further bids. It's like they want to be challenged?
Illbetabuck yes your correct , cdf's don't hold a voting right but it seems polygon know the rules more than me, possibly they know a work around to this. Like I said they seem to have done this before. They will try and increase the bid by ALL or try again with the consortium either way I seem polygon as an allie.
This isn't polygons first rodeo I found this on Google below. From my understanding they are building a stake through cdf's to challenge the offer by ALL and the board's decision to accept it - the board doesn't really have a choice since no other firm offers have been offered other than the 680 mill offer from the consortium. In my opinion polygon may ask the details and try to re-enage with the consortium and hopefully come to some agreement with the BOD. If this plays out polygon will thrive on the increase share price and so will all us shareholders.
Please read page 78 - 80
https://books.google.co.uk/books?id=-RDcBAAAQBAJ&pg=PA77&lpg=PA77&dq=polygon+takeover+strategy&source=bl&ots=Ti6fXAFLx4&sig=ACfU3U05t28suBRF_QpNBKSDgPSJdgczGg&hl=en&sa=X&ved=2ahUKEwiWgImcwp7nAhXHiFwKHS94Dyg4ChDoATAAegQICBAB#v=onepage&q=polygon%20takeover%20strategy&f=false
please read page 19
'The most advanced alternative proposal was a potential debt financing proposal from a
consortium of financial investors. In December 2019, Sirius received a non-binding term sheet
from the consortium to form the basis of a US$680 million funding package to cover the initial
scope of work. On 9 January 2020, Sirius received a revised non-binding term sheet from the
consortium. The Sirius Board reviewed the proposed terms and conditions, together with its
advisers, and concluded that the consortium’s conditions and the time it would take to meet
such conditions were such that there is a very material risk that the overall funding package
would not be implementable by the end of March 2020'
CF would still get 25m at 20p, better than taking 6m at 5.5p and the rest of us will also gain :) win win for everyone.
Hi Hopethebest,
Think about it this way, if you wanted the other 'parties' to negotiate or offer counter offer you need them to believe and the offer is possibly real and they are going to miss out on this, and the BOD's are considering this deal 'possible' deal from AAL. By AAL not offering a 'firm' straight away it gives the other 'parties' less than 28 days to smack their heads and be serious about negotiating a deal with Sirius
Personally I don't believe the BOD's planned this situation, Yes they are accountable and i still believe we should have asked for small tranches than ask for the whole 3 bill. But when i read what people are saying like CF is selling us out and he gains millions i don't think is in his best interest. If we get the funds somehow, his shares will be worth alot more than the 6 mil he would be getting from AAL including his salary etc from AAL( if they decide to take him on). If this was a done deal they would have announce a 'FIRM' offer and that would be it. But I do think there are other parties which they are discussing with and the BOD's want them to hurry up and get a deal sorted before time runs out at end of March.
I'm just thinking out allowed, I could be wrong but i'm trying to think if i was in their shoes how i would handle the situation. either 2 options are occurring
1. The board are not getting enough interest and believe 5.5p is an offer to take rather than nothing and are waiting for AAL for the firm offer before recommend to us shareholders.
2. The parties they are discussing to raise the $600m are asking for unreasonable return or being too stubborn to negotiate and running the clock down for force the BOD's to accept their deal, by AAL offering this 'possible' offer so cheap is to get the other parties to hurry them into negotiating a deal with BOD as if this offer turns out to be 'firm' in the coming weeks and we get sold out at 5.5p the other party have missed out on a huge potential return in the future. I also don't believe Gina would be happy too, she invested $250 for a long term return, if AAL take over and offer an incentive for her royalty its not going to be anything near what she would have got in royalties over the 70 odd years.
illbetabuck - the link doesn't open?
I would prefer a rights issue to raise the $600 than accept 5.5p. In the long run at least we have a chance to get a better return than this joke of an offer. I always was in this for the long term
Has anyone had any success from any contact with IR? If so what did they say about this potential offer? Are there in talks with anyone else?
Does anyone know what the value of the company was when Gina and Sirius agreed the Royalty agreement? From research I think it was around $500 - 600m and she gave $250m for 5% royalty. This was when the mine was still on plans. I would say she took a bigger risk back then than now (considering how much progress the mine site has achieved). There is still a chance the BOD can negotiate another Royalty agreement to get the funds for shafts and then go back to the bond market later. I still think dilution will occur but not over 50% like some people are suggesting and risk the BOD having no control over the company.
I believe in the CF, He has more to loose than any of us, according to the article below his company was bought by issuing 150mil shares to the shareholders of york potash, in which CF has 125mil, If this goes bust he looses everything!!! This will pull through. ALL those who are in the long term will reap the rewards, even after dilution. I have been invested in companies who have rich cash balance and in order to raise share prices higher many have diversified into other projects to enhance the business further and/or bought out its own shares from the market. THIS IS NOT THE END!! The board has options to raise the share price in the future even if current climate looks bleak, they can sort this out.
https://www.proactiveinvestors.co.uk/companies/news/20667/sirius-minerals-acquires-york-potash-for-25-mln-in-shares-24640.html
Does anyone know how many shares will be issued from the stage 1 convertible bonds?
i would say up to 30% wouldn't be too bad, looking at the initial stage 2 offering of the 400m convertible bonds was going to put around 300m shares in the market after being converted. It would have put the company shares to 10bn - we already knew this so giving the same shares to a partner would put us in the same boat as before.
Why did they offer the bonds to PI's? between us all we could have taken this up.
Hi everyone, I have been monitoring this share discussion for over 18 months now and i have seen many different opinions whether this project will be profitable for us SH's. Looking at the current situation I personally can't see the project going bust and the big boys picking this up at the cheap. There are many options CF still has before that happens. Don't forget it's also in his best interest this doesn't happen as it means his 126 million shares will be worthless. I think firstly higher interest rate and possible share dilution if the bonds don't fully get funded could happen. Regardless the fundamentals for this company to be a success is high, especially with the potential profit.
However, the worst case scenario at the moment for us SH's is dilution, I would rather the bonds go at a higher rate any day than any sort of dilution, however if the bonds go ahead, where will this £1 party be held?