Member Info for StarBright

Not likely! When you did last hear of good news being released late on a Friday…? It’s a time-slot usually reserved for sneaking out bad news.

ChartaRex - the back of my envelope looks similar to yours, albeit I use an AISC of $800/oz. I agree with you that the current valuation is reasonable, and am happy to add at this level. If/when we see material upgrades to the 4.2m oz (the central hypothesis of the knowledgable posters here) then there is good upside potential for the SP.

Some of the friction generated around valuation discussions of this nature is a function of the reality that many here were invested - financially and emotionally! - during the period when GGP ran ahead of itself and became overheated last year.

My take: small move(s) on very low volume today + MM's preferring to run a flat book ahead of any announcements. LTH's can just ignore it.

That will depend on the specific wording associated with this (it is singular) warrant.

It is common for warrants to include a provision for "automatic exercise" immediately prior to an acquisition if the acquisition price is above the exercise price. Cenkos are smart chaps, I'd guess this is what their warrant will say.

Agreed - “overdue” isn’t a reasonable perspective here.

A reminder:

Year / Operating cashflow / Share issuance proceeds, all £m:

2016 (4.2) 1.7
2017 (3.0) 3.1
2018 (3.8) 3.7
2019 (1.8) 1.6
2020 (2.2) 4.1
Total (15.0) 14.2

Cash at 31.12.20 = 1.8

This company has raised £14.2m in the last 5 years, and spent £15m. At the start of 2021 it had £1.8m of cash. Of course it is going to be raising money in the next 12m. The question is whether a big bung to Cenkos can help it raise the capital it needs without inflicting too much suffering on existing shareholders. Cenkos must have seen something exciting to engage as they have. Their interests are aligned with existing shareholders because they too would like a share price above 22p. The further above 22p the better...

Good summary.

I agree re listening to existing SH's.

On fund raising I agree with your points but would add that it's much easier to raise capital from insto investors if you are able to relate that capital to a new/specific project of some sort. It's much harder to raise financing (re-financing...) for ongoing projects and operating expenditure, especially if you've been to the well a few times already. Perhaps VAL have new opportunities, or greatly revised scope/potential for existing developments that will require new capital to progress? This would be a better proposition to raise against, with the funding for day-to-day OpEx a by-product rather than a primary objective. Cenkos are very skilled at building narratives of this nature, and very very good at converting "interest" into cold hard cash. With a strong/fresh story to tell on the development side, and (as you suggest) some cornerstone marque-name investors with suitable lock-ins etc, any placing discount needed might soon be regained in SP terms...

Agreed mathsprof. Some have been more careful with their use of language than others. The material point is that Cenkos won't getting 6% of the company "for free". They will be getting it for £858k.

SamBar - if Cenkos exercise their options they will have to pay VAL 22p a share, or £858k. To be "free" the options would have to have been exercisable at 0p.

This isn't that difficult. I can explain it to you, but I can't understand it for you. Please take another look.

viera - Cenkos will have to pay VAL £858k for the shares. Why do you describe this as a "free option"..?

Q&A is interesting. Some highlights/comments:

Cenkos' role: "Now that the foundation is stabilised, we want to accelerate our growth and build a Company with long term growth potential. In order to achieve this, it is important that we broaden our investor base and bring on Institutional Investors who will reduce volatility in the share price and provide the resources necessary for our growth plans. We recognised the need to work with a broker with demonstrated success in securing long term investors.
The Cenkos Growth Companies Team are specialists in identifying companies with high growth potential, supporting their strategy development and securing institutional investment. Under their guidance, we believe we can accelerate the growth and increase the value of the company for the benefit of all shareholders.
Our agreement with Cenkos provides access to all the relevant expertise to develop a growth strategy that will encourage investment from investors with substantial resources.
The Life Science Analyst team will be assisting us to further develop and refine our corporate strategy and provide research notes and investor relations commentary.
The Investor Relations team will be assisting in communications, ensuring our public facing news flow is regular, up to date, transparent and informative; which will include preparing us for investor presentations, as well as monitoring activity to ensure all news is released in an appropriate manner."

Reality check (as discussed here recently):"When Cenkos bring in more institutional investors will you be issuing more shares and warrants?
We have chosen Cenkos as our broker for the next stage of our development as they have strong relationships with the type of investor we need to provide the necessary growth capital. Their processes for doing this vary but our intention is that all shareholders will benefit from our future investment plans."

This is good: "Our recent poll indicated that a Live Interactive event would be the preferred method of shareholder communication. Consequently, we are arranging an event through Investor Meet Company which we are intending to hold in September 2021."

Essentially, VAL management want to break the cycle of placings for OpEx that has proved to be destructive in recent years. They have placed a large bet on Cenkos, who have the ability to deliver. If they are successful, Cenkos will be paid handsomely. Let's hope that it works out well.

Does anyone has a copy of the Numis research note they can link / share here...?

CityWire report the following: "An investment today is as much about taking a view on management’s ability to deliver their strategy, as it is the investments made so far,’ they noted. We see significant opportunities to build shareholder value and we think this could deliver material upside for shareholders."

https://citywire.co.uk/wealth-manager/news/numis-initiates-coverage-of-assetco-with-a-buy-on-20-upside/a1548269?re=88635&ea=471554&utm_source=BulkEmail_WM_Daily_PM&utm_medium=BulkEmail_WM_Daily_PM&utm_campaign=BulkEmail_WM_Daily_PM

Some background info on Eric Feigl-Ding:

https://undark.org/2020/11/25/complicated-rise-of-eric-feigl-ding/
https://www.fastcompany.com/90581545/eric-feigl-ding-covid-19-twitter
https://www.theatlantic.com/technology/archive/2020/01/china-coronavirus-twitter/605644/

This is an interesting company that might (yet!) generate strong returns for patient investors. But this board has been full of nonsense posts regarding the RNS this week, and I hope that the many obviously inexperienced investors here haven’t paid too much attention to those looking to “influence” them into believing that the new warrants will lead to a “short attack” etc etc etc

A little research on identities shows me that I shouldn’t have linked viera and iceman888 in the way I did. My mistake - I’m sure viera understands what he’s talking about. Not sure why someone with his background chooses to join in with all the excruciating let’s ask / tell “Suzy” stuff though…

@viera: “ If the BOD really thought we were very undervalued they would’nt have gifted 6m options at market price to Cenkos We would’ve negotiated a lot better !! Looks like Cenkos pulled the wool over our directors eyes.I hope we negotiate better with our 201 301 and 401drugs !!If SuZy or one of the directors had spent months picking up6pct of Val like Adam and I have done,I have no doubt they wouldn’t have rolled over and diluted us all by 6pct so Cenkos can just benefit from any 201 deal !!Q and A will be a waste of time.Suzy will just say Cenkos are a top broker and that they will help Val grow .Its her first mistake and it’s a very bad one.I just pray she makes it up to allOf us by doing an incredible 201 deal followed by someMore great deals Over to you SuZy ...come good for all your loyal shareholders..we deserve it”

@iceman888: “…We all make mistakes but the key is to learn from our mistakes and do better. Clearly, she has an excellent opportunity here to reflect on her decision and listen to the shareholders. This is a unique situation where all the shareholders agree that the deal was not in their interest.

I have asked Suzy to adjust the deal. Cancel it or make it incremental so that Cenkos get warrants at various prices or reduce the number of warrants issued or even increase the price of the warrants to a fair value (let them earn it). The main point I have emphasised is that NO ONE IS HAPPY WITH THE CURRENT DEAL AS IT STANDS.

If she decides to ignore this important question then not sure if anyone will care what she has to say about the rest of the Q&A. “

@viera, @iceman888 - while I hear your passion and commitment, your posts above (and others over the last few days) reveal only your lack of understanding, knowledge and experience. Your confusion - around for example the meaningful differences between warrants and options, and the mechanics of dilution - undermines your ability to advance critical analysis. As does your evident lack of understanding of capital markets, eg the role of brokers like Cenkos.

It is such a mistake to converse with the company using the constructs and language in your posts above. This is not a platform from which you can assert credibly that “Suzy” has made “mistakes” that should be “adjust(ed)”. You should not assert unequivocally that this a “…situation where all the shareholders agree that the deal was not in their interest“. You don’t speak for all the shareholders do you? You both appear to have travelled a long way out of your depth, and should perhaps now row back quietly.

This isn’t an unusual provision, and I would not interpret it as presaging a buyback as such.

There are a variety of reasons why such a resolution might be sought. For example it may be necessary for the company to purchase its own shares for the effective implementation of executive compensation schemes, or for paying for acquisitions in shares.

Is it the first time such authority has been sought? Worth asking the company why if so. Otherwise, I don’t think it is of particular interest.

Back to school: Parents and pupils delighted at return

https://www.bbc.co.uk/news/uk-england-leicestershire-58324802

HKK - the media is full of “bad news” stories about Covid. What is the purpose of posting multiple links to them here? Given your other posts, readers might be forgiven for concluding that you think that bad news on Covid is good news for shareholders in Novacyt, and that repeating it here somehow helps support your investment…

These “shortz r gunna burn” threads are hilarious. AVCT is trading at around half the level it held through the much of q2. The acrid burning smell hanging in the air is from all of our long positions that have been burned to the ground over the last few months.

It’s good to see these positions turning round and LTH’s here (including myself) may yet do well from this share. But let’s not kid ourselves over the source of the lingering smoke. More days like today are needed, hopefully fuelled by hard news…

“Many”…?