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HMHG - who confirmed it would be renegotiated?

Yesterday there was some speculation about whether Orion would want to renegotiate the terms of the deal, particularly around the 6p share conversion element given the most recent share price falls. Looking back, the share price opened and closed at 3.62p on May 4 which was the day before the RNS so Orion were already prepared to accept the need for the share price to grow 66% to be in the money on this element. Now they need 100% growth. However at the time of the deal they will have already known the 2022 results were poor and that they would be (reportedly) forcing FM out - both of which were likely to provoke a share price fall - so they'd have factored this into their calculations when agreeing the deal. To me, this suggests they will not look to renegotiate this element of the deal.

Thanks, Witty. A good article. I'd also recommend the two vanadium articles linked at the bottom of the one you posted.

The last 5 years have been very tough as a BMN shareholder, but I genuinely believe we are about to turn several corners in quick succession in the directions of operational stability, production growth, global vanadium demand, vanadium pricing, and VRFB take-off.

Maybe they were learning from past experience and were cautious in their modelling i.e. demonstrating that the cash flow model held up on more modest and gradually increasing volumes. Plenty on here - cindercone especially - would have lambasted them for their naivety if the cash flow model only held up for production at capacity with no allowance for production issues.

Given the 1Q23 production issues and the shift of maintenance to 3Q, it is reasonable to think that 2Q and 4Q are where the majority of this year's production is now planned to be delivered if the annual target is to be met. We know 2Q got off to a good start and the fact that yesterday's RNS reiterated the annual guidance (plus what we now know about the recent lack of load shedding impact) strongly suggest the rest of 2Q production was good and on plan.

ARC - Kirkwood only recently became chairman of the BOD so he would have had less power than now. Whether or not his own support for FM substantially changed recently, Orion probably read him the riot act and left him little option.

Two other factors 1) most significantly, it may have been a recent shift in support away from FM by Acacia or Orange Trust that meant FM could now be ousted. These are major long-term shareholders and getting rid of FM without their backing may not have been practical 2) other BOD changes over the last 18 months may have shifted the dynamics of ousting FM.

Yes it is non-binding at present and they can change the terms until it is binding if they wish (most obviously if something comes to light that gives them greater concern, but in theory for any reason). However Orion are a serious mining finance company and they are not going to allow BMN to RNS a deal agreed in principle that Orion have not done their homework on, nor are they going to allow their staff to be quoted in such an RNS unless they approve the wording, or change their minds because their CEO is in a bad mood one morning. Making themselves look like f00ls is not their intent. Therefore, based on what they'd seen to that point they were sufficiently satisfied with BMNs financial plans for the period of the new terms and that should reassure investors.

However I also agree that 1) until the deal is signed off then BMN is in serious short-term financial jeopardy of going under 2) once signed off, BMN is still has a long way to go to re-establish market confidence that it can consistently deliver on its production and financial commitments year on year and that any mishaps are minor compared to the successes. I would also say that if BMN ever, ever, ever again leads a results/production RNS with the safety record above the production or financial data then it's goodbye to my holding as that is not the mark of a credible company.

And when Orion and BMN agreed the recent restructure in principle they will almost certainly have had NDA access to the draft 2022 accounts, will know the 2Q23 production though to the end of May and the June outlook, and the sales and pricing data to date for 2023. Yes, they will want to do due diligence on the numbers, but they would not have agreed the deal terms unless they were confident the financial outlook met their risk requirements.

Wrong HC. Read note 3. It makes it clear that a) the liquidity issues are 12 months from today and are not dealt with b) it explicitly states additional - as yet not in place - funding is needed on top of the Orion resolution.

However, as the RNS comments about the short term liquidity and inability to meet 12 month obligations concerns highlight this better than anticipated cash generation is still inadequate to meet ongoing needs. Further financing (i.e. dilution) will be needed so expect this to weigh on the share price until it is resolved.

Yes, good time for a change. Get the feeling that Acacia and Orion ran out of patience with FM. Hopefully the new CEO will improve operational consistency and shareholder communications for the better and bring a greater sense of urgency and lack of tolerance for underperformance that we've seen over the last 5 years.

I'll be more surprised if we don't get back to 40p in the next 18 months than if we do......

In last year's AGM Fortune was re-elected by 151m for votes to 27m against votes. He has very strong support among major shareholders and so you are wasting your time (and ours) agitating for his removal.

The date on the Baker Steel holding update is 30 April 2023 so almost a month old. I seem to recall it was early May (at the time of the refinancing RNS) when folks were saying Baker Steel was selling down their holding so I'd suggest the true level of their actual current holding - and whether they're accumulating or selling - is unclear ( though personally speaking I can't see how any institution could have been accumulating shares over the past 3 weeks given the relentless dismal share price performance since the refinancing RNS was announced).

Eatstocks - the 12 April RNS said that BMN will own 21-23% of Enerox (Mustang) when the Garnet buyout completes so slightly down on the percentage you mention. The RNS also makes it clear that Mustang is working to relist in London. Of course in time it might move to the Nasdaq but it'll be London in the first instance assuming all the FCA rules and conditions are met.

Unless or until a serious buyer for the shares comes along - and I'm talking a minimum of 30m shares accumulation, probably nearer 50m - then the share price won't significantly move upwards. No matter how good the q2 results are if all that happens is we see some new PI interest then there will be a spike for a week or two then the MMs will walk the price down again so that they have another bunch of PIs sitting on a 20% paper loss and looking to sell again. Rinse and repeat. Easy money for them. We need another institution beyond Orion or a major private investor buying through one of their investment vehicles (surely there's one or two out there who think there's potential here? .... or perhaps not which tells a story if not even a wealthy South African thinks this worth investing in). PI accumulation/churn won't drive and sustain significant share price growth and if this is all we continue to see then the share price will drift in the low single figures for a long time. It's unfortunate and the company deserves better because it is making good progress, but it is very very unloved at the moment by those who can move the share price.

I'm surprised a few haven't tried to blame FM for Largo getting hit by bad weather and missing their numbers as he gets blamed for most things in some eyes!!

Largo's price drop today is mostly about the reduced guidance on production sales for rest of 2023 which was unexpected. The reduced production for 1q23 was already well known so largely in the price already.

The key now for BMN is to have a really good quarter on production. Meet or beat expectations here and deliver on BE and the minigrid. No misses on plans/ targets this quarter and buying should start to overwhelm those still willing to sell at these levels. Largo's reduced forward production and sales guidance should mean a little less supply in the market which should help support V prices in general (and which BMN command a premium on for much of our sales in any case). All in all, lots to look forward to.

Well I have to say I'm very surprised, but there's no doubt that's what it says! FM really needs to confirm this in an RNS because he must know it is a key financial figure that folks have been clamouring for. To exclude it from Friday's RNS and publish it on a conference website the following working day is very poor and, I suspect, in breach of stock market rules about treating all investors fairly.

I'd be very surprised if they did this outside of a RNS. FM has always run a very tight ship on the production and financial actuals and not blabbed new info in conferences or in presentations before. The LSE and our brokers would hammer him if he did and he'd have seriously p*ssed off investors who were not party to such info.

Also, BELCO will be a short term drain on cash flow. See the Mikhail linked in article posted earlier for an idea of the costs involved in getting our first batches ready which we won't recoup until the plant delivers.