Member Info for SickOfTheRatRace

@somtam67 unfortunately for Fortune BMN is a public listed company and takeovers are therefore up to investors to either accept or decline regardless of how Fortune feels about the offer. Of course the board can make their feelings known and it is up to us whether we vote for or against,

This is something that has been discussed before several times and the general consensus has been that the offer would need to be at least three digits, i.e. pounds not pence. As time passes and the company gets bigger and bigger I would hope that PI's would adjust their expectations upwards as appropriate.

I believe the biggest threat to us PI's are institutions with massive holdings. If they are fund type investments they will probably accept any offer as it means a very nice return for their fund holders - even an offer not significantly north of here.

Although it is very unlikely a takeover would succeed now, everyone has a price including PI's. Once you start talking returns in seven figures it becomes easier to convince people to vote for the deal as a lot of investors from the early days are holding large volumes. A £1+ offer would see many set for life.

Anyway the biggest stumbling block to a takeover is first acquiring a significant stake in the company. I don't see this happening on the open market as there isn't enough liquidity - more likely this will be orderly transfer between one holder and another. The time to start getting nervous/excited (delete based on your own desired investment outcomes) is when holding notifications start appearing and increasing. An offer MUST be made should a holder acquire 30% of the company but can be made sooner if desired.

You can read more here: http://www.thetakeoverpanel.org.uk/the-code/download-code

I can guarantee that should a takeover offer appear at some stage that this chat board will be the busiest it has ever been. My long term view as communicated before is that interest will surface after the Mokopane mining right is granted, not before.

Cowboy don't get too excited, as I understand it the meeting is held by telephone and none of the management team attend in person.

The full annual report is now available at bushveldminerals.com

BMN is a good investment regardless of V price. As Pdub has highlighted the vertically integrated model supports both low and high prices.

Low V prices are not good for many suppliers, that's one reason we have been able to pick up assets cheaply. The lower the price goes the more supply goes offline as uneconomic. All that does is increase prices. There does need to be a balance the same way that oil averages have increased otherwise there would be no oil extracted as it becomes more costly to locate and extract what is left.

As a reminder, BMN is in the lowest cost bracket. Vametco is profitable even at previous V price lows, unlike competitors that went bust. If you want to get into a "last man standing" discussion then BMN will certainly be there at the end long after much of the other supply has gone to the wall.

It is very unlikely that the market will again get to that stage. Unlike some who will comment who just look at a 50 year graph and say "It's spiked and fallen before!" the fundamentals of Vanadium are now very different. There are strong noises about energy storage now on a global scale and we are fast reaching a tipping point where a lot of projects are going to be green lit. The great thing for BMN and its Bushveld Energy subsidiary is that they don't even need to worry about what the rest of the world is going to do - there will be more than enough storage projects in Africa to keep them busy for a decade or more.

So the question is not whether BMN is currently a good investment the question is why given the fundamentals of the company someone wouldn't want to invest. This company remains a masterclass in business building and the potential over the next few years is staggering. We don't need to worry about hedging, the company is already doing it internally.

As I understand the Dalian project was doing fine with electrolyte it was just suspended because of the high input cost. Now the input cost is lower I would expect the project to restart with the same electrolyte source as before - given the size of the project maybe they even mix their own?

Any uptrend in demand now that V is cheap should at least form a base. There needs to be an equilibrium reached in pricing to both encourage further supply whilst keeping VRFB costs manageable.

The further V falls the risk of a huge bounce increases - potentially above previous highs. If the lows are being caused by buyers holding on as long as possible and they all start coming to market at once the result could be unlike any spike before it.

At the moment it seems like a game of poker and the river card is about to be turned.

Now that the Vanadium price has reduced substantially is there any news on the Dalian battery commissioning restarting?

Yes the question on the tax bill is one I have also, I was under the impression we could carry forward losses from previous years so it seems to be excessive? Appreciate any accountancy clarifications.

Just to clarify Pdub I also laughed when I read it. I just couldn't believe what I was reading!

It's almost like SP Angel are on our side.... :-)

@RichKen apologising to shorters was certainly unexpected! A definite WTF moment, I thought you were having a laugh and couldn't believe what you wrote until I saw it on the SP Angel daily update page.

Pdub just to add my best wishes for your next round of treatment, hope it goes well and the side effects are manageable.

I had a quick look back on the forum:

4th Feb 19: Of course other finance may be available particularly as a particular stakeholder is awash with cash right now.

21st Mar 18: There is of course the possibility of a corporate loan from a large equity holder such as BMN - which will be somewhat awash with cash.

The arrangement makes a lot of sense to protect BMN holders from unnecessary dilution as well. Although BMN in their own RNS have indicated they will be looking to exit from ATM which I am not sure I agree with. Yes BMN want to be a pure Vanadium play but having an investment in ATM doesn't detract from that and exiting just as the plant ramps up, income ramps up and potentially a dividend is paid would seem a strange decision. Why not wait and see what happens first? If ATM ramp up and deliver as we expect then that BMN stake will be worth a lot more than it is now.

I like the loan arrangement. It reduces the need for another discounted placing and means ATM have the funds guaranteed if they need them. Looks like a bridging facility as they ramp up. That stops ATM being taken advantage of by an entity that knows they are starved of cash (if they are at the time they need the funds). I think we floated this idea on the forum way back as a way to reduce dilution and it looks like that's exactly what they are doing. Aside from the 15% placing at 3p now it will protect ATM holders in future going forward. So it's a thumbs up from me.

Iron ore at $100 x 752,000,000 is $75 billion. Not bad for a parked project!

Sounds like it to me pdub.

"After pricing by large plants, downstream alloy factories are actively purchasing. At present, Travic, Desheng, Jianlong and Liaoning hongjing have a small amount of stock, and vanadium pentoxide spot basically flows to the downstream plants of ferrovanadium and vanadium-nitrogen alloy. The vanadium pentoxide flake in retailing market have been consumed to a certain extent before the price adjustment of large factories. Now, there is not much spot, and the quotation is not less than CNY 120,000/t by acceptance and CNY 117,000/t by cash. Ferrovanadium and vanadium-nitrogen alloy plants are still purchasing raw materials and tightening the market supply. Therefore, in the short run, the supply of vanadium will gradually decrease in retailing market , and the cash price may be back to CNY 120,000/t."

Sounds like it is turning already.

Squeeze is on?

Sammy58 the standard short goes something like this. Holder has 1,000,000 shares. Shorter believes that in 20 days time the share price will be lower than today - perhaps results are due that they believe will be negative or any other reason to believe the price will fall. Shorter says "Lend me the shares for 20 days and I will give you 5% profit". Shorter takes those shares to the market and sells them - usually in large chunks which force the price down. The shorter is betting that at the end of the process they will be able to repurchase those shares for less than they sold them for and thereby make a profit. The end goal being to return the shares after 20 days to the original holder, cover the 5% charge and keep the difference.

You have only borrowed the shares, the dividend is due to the original holder.

Whether an initial dividend is paid or not at least the policy will be out there. It will remove another area of uncertainty and will then be confirmed information to quote in any future discussions.

If the announcement either confirms a dividend will be paid or is planned to be paid from a set date this is a positive for the investment case and I would hope it would be taken into consideration in the share price valuation. As I have commented before should the company start paying a dividend this unlocks funds from a different investment class and more money flowing in can only be a good thing.

Personally I am very pleased to see BMN announce that there are no corporate developments that support the recent downward trajectory. Hopefully this will steady the ship somewhat and clearly this morning it has created a nice bounce.

Also very good to see upcoming announcements signposted in this RNS, stating that the 2018 results will be out this month is a nice morale boost.