Member Info for TakingMyTime

So, here's an interesting question for you all. Suppose Scally yields very, very promising results.

Suppose NCM says to the GGP board, "We'll buy 450 million shares from you for £80 million. That will give you the money to drill to your heart's content, not only at Scallywag but throughout PRE, and even build some infrastructure. By the time you are ready to mine, you'll have Hav money coming in. And of course, we'd own 10% of your company going forward. And you could still do toll processing at Telfer (for a fee obviously), so that would help keep the CAPEX down."

They'd be paying 18p per share, getting a discount because they made such a big investment.

This resolution would allow the BOD to accept such an offer. Two questions, then.

1. If the BOD accepted, would you be happy or unhappy?

2. If they put it to a shareholder vote, would you vote yes or no?

It's partly, I'd guess, to facilitate the issuance of new share options.

It facilitates a rights issue, if they decide to raise funds in that way, or a placing to someone like NCM, if they wanted to take 10-15% for loads of cash which we could use to turn Scal and Goliath and Panorama into pincushions.

@speedy "To think that one arm of JPM does not confide in another is, in my opinion, strange."

I know the law, I know the protocols that are in place to prevent it, I know the consequences of violating those (the fine for gold spoofing was NOTHING, I promise you), I know how vulnerable they would be to lawsuits from their asset management clients if they broke the rules. This is one they won't break.

Let's flip it around, speedy. Suppose you were on the other side, because that's where this comes in and why there are rules. You invested in one of their funds, and then you found out their fund managers were being influenced by the investment banking side. They >weren't< investing your money based on what made most sense for you -- they were investing your money to help their investment banking clients. You would not only withdraw your funds, you would join the first class action lawsuit you could find, and it would be massive. It would be the end of trust, and asset management lives and dies on trust. If investors don't trust you, there are other funds, other asset management companies. Lose trust and you're finished.

So the asset management people won't be having any more communication with their investment banking side than they would with any other investment banker, they'll only get what is made available to other people. They will make their own decisions on what is likely to be best.

You know who was the most unhappy about JPMAM shorting SXX? JPM Investment Banking. It was a huge black eye for them. It probably had no impact on whether the funds came in, that was probably already set in stone by that time. But it upset a lot of people and damaged the reputation of JPM Investment Banking badly -- they didn't even recognise what their own Asset Management people picked up on.

This is a classic example of an investment bank getting things wrong and failing badly, but it's also a classic example of the protocols / Chinese wall working. If the protocols weren't working, JPMAM would not have been shorting, they would have been pulling in the same direction as their investment banking division. That would have served their investors poorly, as it turned out.

Looks like you jumped too soon, LEVIS. I'll probably hold too long, that's my usual pattern.

@Bjorn (great screen name, BTW)
Great post. I'm surprised at the implicit trust in GH here.

I have no reason to distrust him, to be clear. But when he says he's got the shareholders' best interests at heart, I smile to myself, and say, "You would say that."

If he were pulling down a huge salary, I'd be suspicious. But for the most part, the company has structured executive compensation to align it with shareholder interests. That goes a lot further for me in the "trust" department than anything he says.

As far as I have been able to tell, everything he says that can be verified checks out. As far as I can tell, he doesn't say a lot of important things that can't be verified. I have found absolutely no reason to doubt his honesty -- but that doesn't mean I'm not alert to the possibility of him taking actions contrary to our interests. I just think it is unlikely to happen in a way that is sufficiently damaging to destroy my investment.

The BOD obviously recognises the value of shareholder trust over time and are doing everything they reasonably can to protect it. They are playing a long game here, they've got a good thing going, and they aren't going to tear it down just to make a short term gain for themselves. That's a protection for us even if at heart they are snakes.

So I'm much more skeptical than some people about GH / BOD, but I'm not really concerned about it, if that makes sense.

@StrummerJones
Very good point and well-stated. Not only is some of the ramping over the top but any challenges can be shouted down.

That said, many of the challenges are not well-reasoned and balanced. If you go to GGPHelp.co.uk, look at the stuff under Private Investor Findings, Rational Assessor. That was first written here and very well received. Why? Because it is balanced, gives an honest attempt to assess the risks, but doesn't overplay them ignoring the strong points and reasons for optimism.

On the other hand, you can look up the posts here by laurenlouise. Many of the points made are legitimate. We DON'T know if we're going to take this to mining, sell Hav, or sell the company. That's true. But that's not necessarily a negative, because all three of those should result ultimately in a very good return compared to today's SP.

So laurenlouise comes across as simply a deramper and is treated as such, fairly or unfairly, because the fair points raised are not balanced with the things that can and should be said on the other side.

So in short, I think those who bring a measure of skepticism but do so in a balanced way are usually accepted, unless people get really caught up in the moment.

I'll give another example. I'm doubtful that a good report on Scallywag is going to rocket the SP. Others here have very much the opposite view, some think it will double it. I started a thread explaining why I thought that. I didn't get shot down, we ended up with a mostly mutually respectful discussion. People disagreed but no one tried to shut down opposite views.

So I'd say derampers are not welcome but those with reasoned concerns or reasonable doubts as to our upside are welcome as long as they are balanced. And sometimes the worst ramping gets called out, too.

@napth, plagiarism! That makes you qualified for POTUS!

You attributed it and told them where you got it, it's all good. :)

@speedy
re: JPM, Chinese wall. I've explained this before, and I didn't leave JPM out.

It would have been unethical for the JPM investment banking branch to influence the asset management branch. That's not comforting to those who lost money and want to blame JPM, but it's still true.

To be clear, shorting or not, SXX was going to fail because there was no cash. The shorting (which was not only JPMAM) increased the hit for PIs who got out just before the end, but the end game was coming anyway and would have finished exactly the same.

If you want to blame Chris Fraser you've got a good argument, but you also need to say that PIs should have done their own research and asked themselves if it was really viable before putting so much money in. But JPMAM's shorting did not cause or even contribute to the failure of SXX.

"Will look into what happened at SXX"

Perhaps the best way to explain it is to pretend that GGP still owned Hav 100% (no Farm-In), had all these phenomenal results, but no functional business plan as to how to get the gold out of the ground, no funds to mine it, no funds to build processing plant / infrastructure, etc. So a phenomenal asset but no way to monetise it.

Then, imagine that the shares are effectively marketed to everyone in Western Australia as a way to invest that they can boost their local economy, more local jobs, regional pride, all that. So SP goes way up, but there's still no money to get the asset out of the ground. A bunch of local investors put in much or all of their life savings.

Institutional investors look at it, say, "Nice asset, no money, no plan," and start shorting the share. Eventually, the bottom falls out, and NCM (well, for SXX it was Anglo American and it wasn't gold) says, "We'll take over and mine it, we'll offer you 2p per share for the whole thing."

So GH and CB pay themselves nice big bonuses and then tell shareholders, "Sorry, it's not a very good deal, but it's the best you'll get." And then, they accept nice jobs with NCM.

That's pretty much what happened at SXX. Chris Fraser and Thomas Staley got big bonuses, sold the company for nothing compared to what people had paid for their shares, and got nice jobs with the company that bought SXX. You can't say Anglo-American didn't pay a fair price, though, because there never was a business plan and never was funding.

That's why we had to have a Farm-in. It cost us 70% of our mega-asset, but it actually means it is going to be proved up and mined, which we could never have done ourselves. We didn't have the cash. This won't be an SXX repeat.

A lot of these posts suggest Friday afternoon started early for some people, so I'll go off-topic, too. It's not entirely off-topic, because emotional attachment to your investments is risky and for something like GGP, it's perhaps high risk.

I've been looking at C3 Metals recently, and I have to admit, it isn't because I think the investment case is great, or because I'm convinced they have historic finds. It comes down to one thing -- they have some prospects near where I grew up, and I hope they succeed. That's a terrible way to make investment decisions. My father would take me out back and chastise me for even suggesting it, if he were here. For the sake of his memory, I haven't pulled the trigger yet, but I've been tempted.

But I'm not alone. Brits are much more likely to buy BP than Shell or Chevron, IAG (because of BA) or Ryanair rather than American Airlines, etc.

So, two questions:
1. Do you ever find yourself emotionally attached to your shares and buying or holding simply because you want them to succeed, rather than because of hard-headed research / analysis that convinces you they will succeed?

2. Do you ever find yourself giving a preference to shares simply because the companies operate near you (or, like me, near your home, if you have had a major relocation)?

And I guess a third question, if you find yourself doing either of those, do you actually change or just shrug and go with it?

So much speculation about Scallywag, some of which doesn't add up when you know certain facts and consider them properly. Here's my attempt to weigh up the facts.

Known about drilling:
1. Drilling and AEM results are later than we were led to expect.
2. They returned to Kraken for DD drilling.
3. DD drilling is expensive and they have a lot of places they'd like to drill, so they weren't just doing it for fun.
4. They finished at Kraken a couple weeks ago so results from that last hole aren't back.

Known about communication:
1. We haven't been told why we aren't getting results reported to shareholders.
2. We know AEM results aren't delayed (another company reported theirs), but they haven't been reported, either.
3. Lack of communication is out of character for GH, so there must be a reason for silence.
4. If it were a duster there'd be no reason to remain silent.
5. He's an astute businessman, so wouldn't tie his hands by entering JV discussions with NCM without first seeing what Rio or others would offer.
6. He can't go around to a lot of other miners giving them the news and asking for offers without telling us the news.

Probable therefore:
1. He doesn't (yet) have proof that this is another Hav or anything like it. It might be but he can't prove it/RNS it.
2. He's probably not yet in JV talks with anyone. He'd almost certainly report first to see who wants to make an offer.
3. Initial results at Kraken were likely promising and that's why they went back, but not like the best at Hav, or they'd have probably announced it.
4. Initial results were "open at depth" (those beautiful words) and that's why they wanted to go deeper.
5. The AEM results probably also had some promise or we'd have been told.
6. He's optimistic about Kraken but waiting for the DD results hoping they will be even better.

This would explain the silence. He can't say, "We've found something" because he doesn't know yet enough about what they've found. He can't say, "We've found nothing," or, "The lab is slow," because neither is the reason he's not talking. He could say, "We're waiting for the DD results," but that gives the game away, too. He doesn't want to give a Scal interview because he knows a lot but not enough to talk about it.

So, he says nothing. Because the news is probably good but he doesn't know yet if it is really good, or great, or just "promising and we'll have to drill more."

That seems the most probable explanation. It explains the silence on both drilling and AEM results, and also the return to Kraken for DD drilling.

If it's right, we'll get an RNS when the DD results come back. Then, if it is as good as we're all hoping, there will be Farm-In discussions with other players, unless NCM comes in with an offer he can't refuse, or unless someone just says, "Farm-in? Meh, we're buying your whole company" -- and the bidding war starts.

Given current interest rates I'd expect they'll have no trouble issuing a new bond to roll over the debt at a lower interest rate. Would be glad to see them roll over 2/3 of it and pay the rest in cash and reduce the gearing, but not really expecting that.

"So as a smalltime investor I'm genuinely interested in fidning out, without providing any personal details, just how some investors can afford to make these collosal purchases."

Some are lying. Some have even been caught in lies on this board with self-contradictory lies and called out for it. Some have very good jobs. Some are just rich.

My wife and I aren't close to the biggest investors here. For one thing, we bought in late, first at about 9p, but have bought a lot more. I got more today at just over 21p, I was lucky for once. But some people would think we have a lot. I'll tell you how we did it.

1. After we got married and most of the time our kids were growing up, we never went out. No pubs, no movies, restaurants rarely. No holidays to Spanish beaches. We scrutinised every expense and wouldn't spend anything that wasn't in our budget.
2. We built a six month reserve in cash, made pension contributions, but everything else went into the mortgage, which we paid off 10 years after we bought the house.
3. Once the mortgage was gone, we took more holidays, but the mortgage payment went into investments.
4. For years, I invested mostly in low-risk dividend-paying stocks, reinvesting the dividends, with 10% in technology and 10% in "this should be fun". GGP started in the "this should be fun" category but now, I believe it is so derisked that a lot of my other funds are here, too.

That's how we got to where we had some funds to invest. Good luck to you.

I may take some profit today, still thinking on this one.

These are very good results, better than I expected.

"They laid down their lives for freedom while you encourage LSE to close down the very platform for others to exercise that freedom."

True, schlem, but surely you also believe in the freedom of LSE to decide whether they wish to provide a platform for political speech, and even to decide which kind of political speech they want to allow. They could ban everyone who won't affirm that Biden is the Messiah, if they want.

And surely you also believe in the freedom of people to ask LSE to make those decisions. It is no violation of freedom for him to make that request or for LSE to honour it if they choose. Whether he is being morally consistent is another question, but there's no violation of freedom here.

"Oh look another year of zero revenue"

Oh, look, assets.

Wait, let me rephrase that.

Oh, look, ASSETS.

No, that still doesn't cover it.

Oh, look, WORLD CLASS TIER ONE ASSETS.

Well, let's try this.

Get your head out of your backside and LOOK AT THE BLOOMING ASSETS!!!!

Thanks for playing.

@Spratt, I'm hopeful you are right. Because of my confidence in Hav, that hope is a free ride for me.

@Dillon
History says you are wrong, that it is very unlikely for an explorer to hit twice.

That said, the fact that Callum got in first and got his preferred spots is certainly a good argument to the contrary, and I think also the return of a drill to Kraken, as well as GH's most recent words, all add up to a really good possibility that you are right. We'll see.

But if we get nothing out of any of these others, I still expect this to end up a phenomenal investment for Mrs and me.

Maybe a very small part, maybe not. Scal and PRE might be dusters and we might get bought out in January-March at 40-50p. I'd be disappointed, I think there's more to come, but it would still have been a great investment, even at today's price.

"It is the old " risk / reward" equation."

Exactly. If you want the mega reward, you've got to take the mega risk. That's not GGP because we already have part of the reward.