Member Info for Steve4077

>> Didn't he sell a company some years back for 2 or 3 hundred million?

Yes, but he probably didn't own a large portion of the company. As mentioned below, he has £600k invested in XTR. That was worth over a million at one point, so I am sure he is keen to return to that situation.

>> But WHY given all those truths from CB are we down here well below the placing price with all that copper in the ground.

You mentioned earlier that you had reduced your holding. I am sure others have done the same. The price is falling because people are impatient and are selling. I've had my own wobbles over the last few days but every time I reassess the available evidence, I either hold or buy more :)

I am sure CB is well aware that the price drop is connected to his silence, as he has stated several times that he reads the forums, which leads to the question of why he continues to remains silent. He also has a lot of shares so it would be in his own interest to say something. For some reason he must think that staying silent in the short term is the best option for the long term (insert your own theory here).

>> Eg 19th April his personal opinion that we have the grades - between .38 and .45

That was also the day he bought 1m shares at 5.7p, so backing up his assertions with £57k :)

>> Has to be the bottom! Watch for buying action around this level!

How many bottoms have you called so far? I don't think it is helping :)

>> continued radio silence adds insult to injury for us.

We know that CB does read the board, so I am sure he is in no doubt about our impatience for results. He also had a golden opportunity last Monday to mention that in the RNS. He covered the IP survey and the "technical and financial modelling for an initial open pit mine", yet didn't mention the assay delay.

Choose one of the following options:
1) He doesn't care about our desire for information and the falling share price.
2) He did want to mention the assays, but just forgot when he created the RNS.
3) He can't mention the delay because he already has the assays.

>> You didn't mention the fact that in Sept ARCM issued an RNS to say results were delayed due to Covid causing delays at the labs.

Just went back and read that. 21st September announced that "the laboratory has indicated the results should be with the Company shortly."

They must have the same person writing the RNS as XTR - it took another 6 weeks after 'shortly' :)

>> He spent all year on social media / interviews etc re XTR, last few weeks, not a bean. WHY??

That is the million dollar question :)

>> WE DO NOW lol

Except you don't know who I was working for or who we were talking to, so I don't think I am revealing any great secret :)

>> GGP never ever withheld assays when they were negotiating with NewCrest so why do people think Xtract would?-

Maybe AA and Newcrest work differently. For example:

Last year ARCM announced drilling commencing in June 29th 2020 for 8000m with holes up to 250m deep. Fifteen days later, they announced they had signed an exclusivity agreement with AA while negotiations took place. The drill results for the first two holes were not released until October 30th, even though they were shallow holes. That is about 17 weeks for assays while talking to AA.

Not saying that is definitely happening here, but there are parallels

Here are the AIM Rules 2021. I was quoting from page 38 in the last post.
https://docs.londonstockexchange.com/sites/default/files/documents/AIM%20Rules%20for%20Companies%20%2801012021%29_1.pdf

>> I cannot think of any legitimate reason why either AA or XTR would want assay results withheld from the market during a negotiation. It is not commercially sensitive information that you would use an NDA to protect.

Assays are extremely commercially sensitive. They could make or break the company in this situation.

If I was AA, I would want total radio silence while I assessed whether a deal was a good idea. The last thing I want is everybody and his dog jumping on good assay results, ringing CB and disrupting negotiations. From CBs perspective, he may be happy with a slightly worse deal than he might get in an open auction, if he can get that done early, with little fuss and with a known quantity (AA) that knows the asset. (CB is 77 and won't necessarily want to play the long game).

Just for clarity, I am not saying that a deal with AA is the most likely outcome. I am just saying it is a theory that matches the available facts. Here are the relevant rules for those who say the assay results must be released.

AIM Rules on Disclosure under Rule 11:

Unless disclosure is required under Article 17 of MAR, an AIM company may delay notifying information under this rule if it is an impending development or a matter in the course of negotiation provided such information is kept confidential. The AIM company must ensure it has in place, in accordance with rule 31, effective procedures and controls designed to ensure the confidentiality of such information to minimise the risk of a leak.

In such circumstances, where an AIM company is able to delay notifying information about impending developments or matters in the course of negotiation it may give such information in confidence to the following category of recipient:

(i) the AIM company’s advisers and advisers of any other persons involved or who may be involved in the development or matter in question;

(ii) persons with whom the AIM company is negotiating, or intends to negotiate, any commercial, financial or investment transaction (including prospective underwriters or places of its securities);

(iii) representatives of its employees or trades unions acting on their behalf;

(iv) any government department, the Bank of England, the Competition Commission or any other statutory or regulatory body or authority.

>> Irrelevant of everything surely them not releasing assay results is against fca rules?

Anything that can significantly change the share price (such as assay results) has to be released, UNLESS negotiations are underway. See AIM rule 11 and exceptions.

>> the NDA would cover the negotiations themselves, who they were with, the assets under discussion etc, NOT some critical bit of company data

That hasn't been my experience. In the M&As in which I have been involved, the NDAs covered the detailed discussion of existing company finances, projects, etc, and detailed projections of future performance. In fact, far more detail than we would give shareholders even without M&A discussions.

As an example, in 2015, I did a three hour detailed presentation to a FTSE 250 company we were considering buying. This included a LOT of detail for our own business. I was presenting to senior directors, along with their lawyers and KPMG (acting as advisor for them). Then I spent a long time answering whatever questions they came up with. The reverse process also took place. There is no way we would have done that for our own general shareholders, unless they were large enough to have board representation.

If news of those negotiations was revealed, it would have a significant impact on both share prices, which is why it was so important to maintain secrecy until we had an agreed position. In the end, we decided not to buy them so apart from a relatively small group of people, no one knows that the negotiations even happened.

One possible scenario for example is:

1) We know that AA have a legal agreement with XTR (from the purchase of Bushranger) that they have first refusal if the deposit reaches 2mt contained copper OR a decision is made to mine.

2) CB sees the first part of the IP survey (and maybe the assays) and knows he is on to something massive, so he informs AA he has decided to mine (to trigger the above) and on that basis he is engaging an independent firm to undertake technical and financial modelling for that open-pit mine (modelling as per last RNS)

3) Now AA have to make a decision, so they tell Colin they are prepared to spend some time in initial negotiations, with the proviso that CB doesn't release the assay results when available (as that would bring in other potential buyers and put more pressure on AA) and that he keeps quiet about those negotiations (for the same reason).

4) Because of the above, CB can't release the assays and he can't mention the negotiations. He is also staying out of interviews so he doesn't get carried away and accidentally break the NDA with AA.

5) Investors have no idea what is happening, become nervous and start selling.

6) Watch this Space...

Of course, this is entirely supposition on my part and I could just have a very over-active imagination.

>> if they are in talks with someone why dont they just say so

Because most negotiations will involve an NDA (non-disclosure agreement) that forbids those involved to mention that negotiations are underway. I've been involved in a few mergers and acquisition and I have had to sign an NDA every single time.

>> By product of course is that people are scared to touch this with absolutely zero info on assays.

I've added more than a million shares since the start of May (at about 5.2 average) and I am now at 2.5m in total at 4.4 average. Not looking like a great decision right now :) but unless the assays are terrible, it is difficult to see XTR remaining at this market cap.

I don't see how we could have had assay results before 19th April, because CB bought 1m more shares and could not be doing that on unreleased results. Other companies in the same area are announcing long delays. Also, that share purchase by CB was after the first 2 weeks of the IP survey and presumably with knowledge of the XRF on holes 2 to 6.

The existing JORC and the hole 1 assays are both fine given the scale of Bushranger, so no immediate evidence to assume the other holes would be significantly worse, and we have the very promising IP survey. Finally, the language in the recent RNS has gone from aiming at 2m tons, to delineating 2m tons to exceeding 2m tons, which is encouraging.

The worse case scenario is that CB has mislead us for the last few months with his many optimistic interviews/RNS and has bought 2m shares and added 10p options as misdirection tactics. Or maybe the assays arrived in the last 4 weeks and didn't match the XRF and CB is holding on to them (although why not release at 5pm Friday as he done in the past). However, the more likely scenarios are delayed assays or perhaps a small chance of a negotiation.

With regard to those scenarios, I can't understand is why CB hasn't confirmed the assay results are delayed. It would be easy to do and would protect his own 12m shares + options investment. Also why he didn't do an interview after the very positive IP RNS? Being quiet is unusual for CB, especially when he must want to talk about that IP survey. That's why I am assigning a small chance that the silence is being forced upon him by negotiations with a third party. Maybe the section in the last RNS about open pit scenarios constitutes a 'decision to mine' as per the AA agreement.

Also, the individual situation will have a major influence on any sale. One of FatherTedFecks South American Mountain deposits is going to have a very different in-ground value vs a deposit in Australia, with existing infrastructure and close to a major port.

For another view, this article on valuing mines suggests 5% :)
https://undervaluedequity.com/mineral-deposit-value-how-to-calculate-the-potential-value-of-a-mining-project/

>> I did some digging on validity of 3c / lb metric and it is mentioned in this very, very comprehensive 2018 report on copper M&A

The article uses $74 per ton at exploration and $193 at feasibility. Copper price at the time of the article was about half of current price. You also need to bear in mind that extraction costs are fixed, so doubling the value of copper will probably quadruple the actual value post-extraction.

So $74 x 4 = $300, which is about 3% vs current copper price.

>> The problem I see with this Steve is that, by assuming this, we also have to assume that Bird raised funds for Phase two based on H1 data alone

He raised funds two weeks after the start of the IP survey and also extended the IP survey from 4 to 6 weeks. After seeing the results of that IP survey, the placing makes a lot of sense.

>> I may be wrong, and hope I am, but I do think it unlikely that discussions would be held with a major unless there was an updated JORC after Phase 2 was completed.

I wasn't sure if that was true or not, so I checked ARC minerals which are involved with AA at the moment. They issued a drilling RNS on June 29th 2020:

"Arc Minerals is pleased to announce the commencement of the second season of exploration activities over the Zamsort and Zaco license areas in north western Zambia. Diamond drilling activities will commence over the Fwiji Target ('Fwiji') where the company has already defined the target area through previous exploratory works. Follow up work at a number of the other target areas, including Cheyeza East and Muswema, is currently underway.

The Fwiji target area has been confirmed by both the soil sampling and airborne geophysical programmes and is situated on the northern limb of the Nyambwezu Syncline. The area is dominated by an open, south westerly plunging anticline, as defined by the Lower Roan quartzite ridge."

So they had samples and an IP survey and were starting a drilling program to investigate. 15 days later, they issued a new RNS

"Arc Minerals is pleased to announce that its two subsidiaries, Zamsort and Zaco, have signed a confidentiality and 6 month exclusivity agreement with a subsidiary of Anglo American ("Anglo American") in respect of its copper exploration licenses in Zambia.

During the exclusivity period, Anglo American will be permitted to conduct a technical review which, if satisfactory, may result in an extension of the exclusivity and the negotiation of a commercial transaction. Arc will continue with its existing drilling programme during the period of the agreement."

Our situation isn't quite the same as AA already have an effective exclusivity agreement with XTR, but it is definitely the case that AA are getting involved at the early exploration phase without any JORC involved.

I also looked at GGP and Newcrest got involved very early in the drilling and exploration program.