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>> But even that can be extended if agreed by both parties.

> Big if. and there'd have to be a good reason.

But "both parties" here is Jim and MTL - the two signatories to the undertaking. If MTL say "Jim, we need more time before we make a formal offer, could we extend our undertaking deadline", I can't see him refuse.

The interesting question, though, is why they put such a tight deadline to begin with. We note the undertaking was signed last Thursday, and this suggests they expected a formal offer to follow fairly swiftly. The knowledge that Calibre are still in play could be a reason to need more time than they thought. For which reason, not having a formal offer by 5pm today could actually be good news rather than bad.

I don't see why. The deadline for making an offer under Rule 2.6(a) of the Takeover Code is 29th December. Even that can be extended.

The only deadline at 5pm today is for Jim's signed undertaking to come into force. But even that can be extended if agreed by both parties.

And be to my guns

One of the events that would make the whole thing null and void is a takeover by another firm becoming effective.

For that to happen, Condor shareholders must vote on that rival proposal.

At the point the vote occurs, the undertaking is still in force, because a rival takeover hasn't happened.

So the undertaking forces Jim to vote against that rival offer.

So, if his undertaking becomes legally binding (which is not yet), any better offers have to be voted through without him. Of course, if the offer is improved by enough, that should be very possible

Agreed about it being moot. It's a cleverly worded agreement.

How do you read the non-compete bit of it? It reads to me that if the undertaking becomes effective he's pledged to vote against any competing bids. Now, if any competing bids became effective, he'd be released from this, but that happens after there's been a vote. What have I missed?

Except that if the MTL offer becomes firm, and is recommended by the CNR board, Jim is then obliged to vote against competing offers, making them less likely to become effective (but not dead in the water)

The fat lady is yet to sing

That old chestnut - just means that you were able to buy below the publicised mid-price

@freefaller

It's a loss-making company because, until now, it's been a minerals exploration company not a mining company. They are always loss-making, because they're spending money to find resources and prove them up. They become profitable when they go into production, and have made enough (revenue over opex) to pay back the capex.

So don't compare it to its previous years' losses.

Next, the accounting convention for exploration assets is to value them on the basis of the money spent exploring and developing. They are not shown on the balance sheet at a valuation that reflects the potential revenue that's in the ground.

So don't compare it to the carrying value on the balance sheet.

This is an inflection point for any mine at this point. It's fully derisked, because the land is owned, there is a compliant resource with a known number of ounces, and the economic assessments have all been done. In this case, there is over $1bn of gold at the La India area (which is only one area of the La India project). A sizeable proportion of that is open-pit, so the capex to get that going is tiny. The mill is already bought. So it would be profitable really quickly. There are also further reserves not yet proven, in the other mine areas, and at depth / along strike at La India. So in reality a lot more than that $1bn+ will come out of the ground. That further exploration will be easy to pay for once the known reserves are in production.

That's why £60m is far too low to pay for a mine that will give the buyer well over $1bn of revenue with very little cash to spend or time to wait for those revenues to start to come in.

If it's done be a scheme of arrangement, it has to be sanctioned by the relevant court. I'm pretty sure that needs two shareholder meetings that happen straight after each other. There is a court meeting requiring a 75% vote, and a general meeting requiring a straight majority. But I'd need to check further to be sure

I'm hoping it will never get to the point where shareholders are asked to vote on it, and the board can kick it into touch for us in place of something far better.

BMR, I take it you sold Condor long ago?

As I understand it, it will be irrevocable, but only if the offer from Metals becomes recommended by the Condor board. Until the board say aye, everything is open and in play.

MTL shareholders aren't exactly bailing. A few have sold. As someone else said down the page, it is normal in a takeover for the acquired company to rerate initially and the acquirer to derate. That's usually because to get a deal done you have to offer above the current market value of the asset, so it feels to the shareholders of the acquirer that they're overpaying.

The effect is usually small and sometimes short lived. In this case, Condor is so undervalued relative to any idea of fair value for La India that the acquirer would be getting a bargain. That's why Condor long term holders see the uplift on last week's share price but still feel they're being sold far short.

😂🤡

It is also noted that in relation to the "irrevocable undertaking" as referred to below, Galloway Limited has informed the Board of Condor that this was provided in contemplation of a recommended offer from that party and that until and unless that is the case, they reserve all their rights in relation thereto.

Ah, with you now MarketAnalyst. There's a separate question of whether the board of Condor will recommend the deal.

25% is a lot. It needs a high turnout to overthrow.

It's not down to whether Condor Gold accept it. It will be down to whether shareholders do.

There was a leak. Sky broke the news while it was still under embargo. It was officially announced this morning at 7am that there was an offer being considered, and then later this morning the terms of the offer were announced by MTL. Jim had already signed a deed of undertaking on Thursday last week, and that deed says that the plan was always to publish these things today. So there was a leak, but they were going to announce it anyway today.

As for this not yet being a firm offer, that is of course correct. However, as I read the deed of undertaking, it has come into full force regardless.

All references in this undertaking to the Acquisition shall:

1. mean the proposed acquisition by or on behalf of the Offeror of all the issued and to be issued shares in the Company, which acquisition is intended to be implemented by way of a court sanctioned scheme of arrangement under Part 26 of the Companies Act 2006 (Scheme), noting that the Offeror has reserved the right to implement the Acquisition by way of a takeover offer, as defined in Chapter 3 of Part 28 of the Companies Act 2006 (Offer); and

2. include any revision or variation in the terms of any acquisition as referred to in paragraph 1 above which may be made by or on behalf of the Offeror from time to time

The condition referring to 5pm on 4th December is this:

"Subject to your announcing the Acquisition under Rule 2.7 of the Takeover Code by 5:00 p.m. on 4th December 2024"

Now, I agree that is unclear. I think I'd argue that the RNS today is them announcing the "Acquisition" in the sense of "the proposed acquisition". The deed doesn't say they need to make a firm offer by 4th, just announce that they propose to acquire. However, where there's some lack of clarity is whether referring to Rule 2.7 at that point means they need to have made a firm offer by then.

The document itself is dated 28th November. It wasn't published then. Indeed, paragraph 4.3 says this:

Prior to this undertaking being published as referred to in paragraph as referred to in paragraph 4.1.4 above, I agree not to disclose to any third party (other than my professional advisers) the existence or subject matter of this deed or of any of the arrangements or proposed arrangements to which it relates unless such disclosure is require by law, the Panel, the Financial Conduct Authority, the London Stock Exchange or pursuant to any other legal or regulatory requirement in which case I will only make such disclosure following consultation with the Offeror.

It starts like this, immediately below the date of 28th:

I, the undersigned, understand that the Offeror is considering the Acquisition substantially on the terms and conditions set out or referred to in a draft of the announcement announcing the Acquisition, a copy of which is annexed hereto at Schedule 2 (Announcement), to be issued on or about 2nd December 2024 by the Offeror pursuant to Rule 2.7 of the City Code on Takeovers and Mergers (Takeover Code), subject to such other terms and conditions as may be required by the Applicable Requirements (as defined below) and/or as may be agreed between the Offeror and the Company.

So on Thursday, Jim entered into this deed with Metals, expecting it to be published on or about today. Which happened.