Member Info for TakingMyTime

@Chris
They are all sharks, but most sharks recognise that strengthening their clients helps them more than eating them.

It was an AIM share when the JPM relationship started, and that is the point at which they could and probably should have advised, "This isn't going to work, you don't have the money." Which was my point.

Third and final part

If GGP does engage JPM, it would presumably be the investment banking division. It will certainly not be the Asset Management division that was shorting SXX. The "Chinese wall" I discussed in my prior post still exists. Neither the Asset Management division nor the Investment Banking division can pass any information to the other except what is passed to other market participants. Neither can influence the other.

If JPM Investment Banking is engaged as a company broker to market GGP to institutional investors, that is what they will do. They will make money if they succeed in doing so.

JPMAM, however, will do whatever they decide to do. They might short GGP (but that would be stupid). They might buy GGP, if it fits the investment profile of one of their funds or some of their private bank clients. They might buy GGP for one client and short it for another, if the funds or investors have drastically different risk profiles, and/or if different fund managers within JPMAM have drastically different views on the company.

All of that would be entirely ethical and appropriate. Portfolio managers make their own decisions, within the Asset Management division. SXX shows that the "Chinese wall" is working properly at JPM. If it weren't, the bosses would have let the word come down to JPMAM, "Investment Banking needs you to invest some funds in SXX." They would have taken investor funds and put it into SXX, not because it was a good investment, but because the IB department wanted them to. That would have been grossly unethical.

The fact that the two divisions were at cross-purposes demonstrates that it is working how it should work.

If GGP engages JPM Investment Banking as a company broker, I am entirely comfortable with the ethics of the matter. And they've been successful enough that I don't particularly find the SXX failure all that troubling, though of course it was disappointing and devastating to investors. But the failure was not primarily JPM, it was a business plan that didn't have enough cash to succeed.

I get why it bothers people but it's because they don't understand how the "Chinese wall" works in these huge financial firms. It's enforced by regulators, and it works at JPM.

(I do not work for JPM but I do know a lot about them)

Another division of JPM listed on the page I gave in part one is JPMAM. They provide investment services and advice for high net worth individuals. They also provide many funds.

The Asset Management division has a fiduciary responsibility to maximise the return of the funds invested with them, whether for their private clients or for their fund investors. That means they scour the markets for the best opportunities (just like any other fund or private bank).

There is what is known as a "Chinese wall" (https://www.investopedia.com/terms/c/chinesewall.asp) between JPMAM and JPM Investment Banking. They are not to exchange information between them or influence one another. They are completely separated, even though they are owned by the same parent.

JPMAM was shorting SXX. They had no responsibility to SXX not to do so. They were doing so because they thought it was a good play for the people who had invested their funds. That division of JPMAM had a fiduciary responsibility to THOSE people. The Investment Banking division had a fiduciary responsibility to SXX and its shareholders.

Because of the "Chinese wall" there was no conflict of interest -- each division was making its own decisions and giving its own advice based on the information available to it, and not the information available to the other division.

There is not a "Chinese wall" between JPM Australia and JPM UK. They can talk to each other. But JPMAM and JPM Investment Banking are very restricted. JPM Investment Banking makes the same info available to JPMAM as they do to other asset managers, no more and no less. JPMAM has no responsibility to listen to JPM Investment Banking any more than they do to Goldman Sachs Investment Banking or any other corporate broker / advisor. JPMAM has a fiduciary responsibility to its investors that trumps its responsibility to its owner and certainly trumps any idea that they should help out their investment banking department in any way.

JPMAM shorted SXX, and it hurt the investors, and probably hurt their investment banking division -- it turned into a spectacular failure of their banking division, and potentially the short contributed to that failure. It was, however, a brilliant decision for JPMAM's investors, and that was to whom they were responsible.

It was all very unfortunate for SXX investors. It was also unfortunate for JPM Investment Banking, it hasn't helped their reputation as a great investment bank. They have a lot more successes than failures, however, and their reputation is still very, very good.
/part two

I'm going to do this in more than one post.

JP Morgan's "What We Do" page is here: https://www.jpmorgan.com/global/what-we-do

The first thing listed there, the Investment Banking division, had a relationship with Sirius (SXX). They served as the company broker, helping to arrange finance and pushing the company to institutional investors.

In April 2019, they agreed to provide a RCF (Revolving Credit Facility) of £2.5 Bn. That is a lot of money even for JPM. It was conditional on Sirius raising the rest of the money they needed at a rate less than 15%, and other conditions.

Sirius found that to be difficult and tried to put together a deal but it would have breached some conditions, including the 15%. JP Morgan would not give them a waiver, so it killed the deal, which effectively killed the company.

JP Morgan had the right to do that. No one is required to loan money to a company if the company is going to take on more debt than they think they can afford to pay, especially £2.5 Bn. JP Morgan's Investment Banking department had taken the view that anything in excess of 15% would be more than Sirius could pay, and so would put their loan to Sirius in jeopardy.

The fault here was not with JPM Investment Banking but with a business plan that required far more money than the company had and no clear path to get it. One could argue that they should have advised SXX not to even try. But it wasn't that far from succeeding, and JPM, as near as I can see, not only did a good job of promoting the company as brokers, but also was prepared to put their money (£2.5 Bn) where their mouth was. It was an AIM share, it was always a risk. If it had succeeded, JPM would be one of the heroes of the story.
/part one

"So many responded to that thread and yet very few have asked about it."

What's to ask? A poster here said he knew about a meeting, and his mate who was going to be in it wanted some questions he could ask to sound intelligent in the meeting. He asked for suggestions. People gave suggestions.

I for one didn't have any great expectation about hearing about the meeting, or that we'd get the answers to the questions. Hydro's mate may not want to be exposed, or Hydro may want to protect him. So we may not get those answers. My world will not be made worse for it if we don't. As far as I am concerned, it was an interesting discussion about "what would you ask if you could."

I realise that some people think it was all a hoax by hyrdo. If so, I can't see it's done much harm. It was still an interesting discussion. I don't think it's made me think any more highly of him or trust him any more. I get that there were some inconsistencies but everybody has inconsistencies in what they put on Internet forums.

The investment case for GGP is still solid, whatever happened yesterday.

BP doesn't sell cooking oil.

So, SB, I like the graph idea.

Maybe also an intro page titled "The Case for GGP" that boils it down to a 2 minute read, followed by "If you are interested, we recommend you read this next, then watch these videos, etc."

Something to hook the casual investor in and make them want to read more. The story is there, the problem is that most people don't want to take the time to hear it unless they are already partly hooked.

We could certainly do a better job with advertising it here, too. Pages go by without anyone making a reference to GGPHelp. Somebody new here could read a bunch of comments, not have any clue what all the excitement is about, and go away. That kind of person needs to be directed to something that says, "Here, in a nutshell, is why you want to know more about this."

That would be very good news if you are right, Mickey.

So some guy we've never met with a screen name that includes "Bossman" that has only posted on this board once before tells us on an Internet forum to buy this share.

Why? Because he knows some guy named 'Clangers' who said so. And because 'Clangers' is a 'proven lege'.

Wonder if 'DaTradeBossman' is a boss man in 'da trade' of used cars. He's trying to sell us a clanger, after all.

DYOR.

A rights issue of this size makes no sense unless we were not told the truth about how much cash the company had, and what the cash burn rate was.

So I don't expect it. I still don't expect a RI at all.

I absolutely do expect the CEO / Board of a large company to make contingency plans. Since they didn't have any proof as to when they'd be flying again, they absolutely had to make contingency plans. They had to be putting things in place to raise funds. One of the options will certainly have been a rights issue.

So of course they've looked at it. So when someone leaked it, they had to confirm it. The RNS doesn't state that they are doing a RI, it states that there have been press reports and so they have to confirm that they've looked at it. What company in their position WOULDN'T have looked at it?

So, if you are going to confirm it, what will you do? If you want to reassure the markets, you say that this is ordinary contingency planning as any responsible business will undertake at this point in time, one of several options that might be considered in a worst-case scenario.

If you don't want to reassure the markets, if you want to send a message to the union that if they keep playing silly games the whole thing might collapse and there won't be any jobs at all because THERE'S NO BLINKING MONEY, then you just baldly state the fact that it is being looked at. And, not only that, you give a figure, and it's the worst case figure you've looked at.

And if you wanted to do that, you might even have someone leak it to the press intentionally.

It is, of course, possible that I'm entirely mistaken and going to virtually lose my entire investment here. But I simply don't believe that there will be any RI anywhere near the size reported, and I still don't actually expect any RI at all.

I do expect the next week to be bumpy.

Some might remember that I said I expected all the bad news that could come out, would come out, before or with these results. Everything bad that could be brought forward would be brought forward.

I'd suggest that if the market believed there would be a £2.75 Bn rights issue, the SP would have dropped to approximately 150. That means there's a lot of people out there like me who don't expect it. We could be wrong, of course, markets often are.

GLA

@Jerry, you are right, I was wrong. I made two mistakes. The first was to forget that we've already established today that you are always right. I won't bother you with the details of the second, sorry for wasting your time.

So, if UBS is correct, there should be a GGP rerate of 15.5p / share above their previous estimate for Hav. We don't know what their previous estimate was, but we know it wasn't nothing because they have already upgraded NCM based on Hav. I'd suspect they are valuing it at a level that would take our SP to at least 30p, but I doubt they'll be telling us.

If you had a chance to buy a piece of property worth £1 million, but the neighbour had an option to buy half of it in six months for £1, would you pay £1 million or £500,000?

"If we get a potential offer later this year or early next year, it’s highly likely that GGP will still hold 60% of Havieron."

And NCM will hold the right to acquire 30% more of it, from whoever buys it from us, for almost nothing. So the buyer, whoever it is, will know that NCM is certainly going to exercise their option to own 70%, at least. So any buyer will only pay for 30%.

@Jerry, reading again, I think I got confused because it's far from obvious what what exchange rate you were using to get from AUD valuation to GBP valuation. I think you've got something wrong there but it's not what I thought you were getting wrong.

ttb "So a +10% increase on their price target due to Havieron. So that's an additional $2b based on their market cap and ultimately a 70% interest in Havieron."
Jerry "If you thought that GGP was fairly valued in the same way as NC was fairly valued as per Havieron then the equiv increase for GGPs stake on a 30% basis is £660myn, more than the current mkt cap"

You guys are looking at the wrong number here. It's an INCREASE of $3 / NCM share. That's not for Hav, that's an increase over how they valued Hav back in June. They now think Hav is worth $3 (AUD) per NCM share, or roughly $2 Bn, MORE than they thought it was worth in June. In other words, the last update, in their view, added $2 Bn to NCM's share of Havieron. That's not total value, that's just what the latest update added. That's an after tax gold-in-the-ground valuation.

We don't take 30% of that. The $2 Bn is NCM's share (70%). Total value of the update is $2.85 Bn, and our share is approx $850 million, or approx £500 million.

If UBS is right, their update from their 12 June price suggests they think Hav has grown enough with the latest news to justify a £500 million increase in our market cap.

If they are right, we were undervalued before and are even more undervalued now, and potentially at risk of a hostile takeover at a price that is way too low. I suspect their underlying figures are valuing Hav at $7-8 billion (AUD) or more.

Very significant in that it immediately mitigates some of the cash burn problem. We don't know how fast the cash burn is currently but this is good for that much more time before IAG has to borrow.

And this board spends more time talking about and responding to a couple trolls than about very significant news. Pretty much ready to abandon it, personally. Filtering them helps but then you get everyone's responses to them anyway. I don't really want to read a bunch of people telling off trolls any more than I want to read the trolls. Just saying.

@Jerry " I get loads of things wrong every day."
Is that one of them? ;)

"any idea how many warrants and options are outstanding?"
https://greatlandgold.com/company/

@Jerry "I am sorry but if you really think this is dilution than you are using the wrong amount of shares in issue for your calculations."

So very true. Do you ever get anything wrong?

@Jerry "But the directors have the same right to sell as each and every one of us"

No, you never get anything wrong, LOL.

Shareholders need to remember that GH has been paid in cash and options. The options are part of his compensation. Because he was willing to take options, the company had to pay him less in cash, which meant that the company has had the money to pay for tenements, drilling, etc. So he's collecting some of that. Good for him, and thanks to him for deferring his compensation for a while.

If you don't like him exercising his options, selling enough shares to pay the tax on that, and selling some more shares to collect some of the compensation he's been deferring, you simply don't understand enough about how this company works.

The use of options for small / start-up companies is a great way to go. It makes the executives major shareholders and so aligns their interests with that of other shareholders. The best way for GH to get rich right now is to make his shares (and ours) worth even more.

This RNS is good news. It means GH is getting paid, a small amount of extra cash for the company, etc.

The other reason it is good news is because it means we can quit blaming the recent drop in SP on MMs or others. It's partly because GH sold 3.5 million shares. Temporary blip while the market absorbed them, I expect we'll be back above 14p before long, maybe even today.

"I put the buy on spike down to a sensitive button on my mouse ; )"

Yes, my mouse has committed many crimes against me over the years.

One of my buys was on the spike up to 12, silly me. Could have had it a little lower the next day. Current share price suggests it wasn't a disaster for me.

@TT "@ TMT Totally disagree."

That's fine, just telling you the way I took it initially. Maybe I'm the only one, maybe the reaction of others suggests not.