Member Info for TheMadStork

Fop72: Based on the current valuation of other PGM players and the mid-low tier exploration assets they have (and let's be 100% clear here, MT is towards the lower end of exploration assets globally) then EUA's implied valuation should be somewhere around £50m/2p. Obviously it will never trade there even if/when the FSP fails; this board is proof enough that there will still be legions of punters willing to believe whatever story the company comes up with going forward.

Bobzrig: I'm actually being incredibly generous with what EUA has. The supposed 15m oz it has outside of the 2m defined resource is incredibly speculative based off of very little drilling and would in no way even be considered Inferred under JORC. I'm also applying a hefty discount to the theoretical valuations of other PGM miners, as they all have mines built, reserves not resources, production, cashflow etc.

Calamari - this is not the biotech sector, where every drug and treatment is different. This is mining, where commodity prices, extraction costs reserve and resource figures are all standard and known.

EUA has one mid stage exploration asset with a JORC resource of 2moz 2E PGMs (plus about 15m oz which would not even be in the inferred category under JORC). It has no DFS, no BFS and is years away from production in a hostile juristidiction with little infrastructure. This, under the theory of the bulls here, is worth £700m - £3.5bn.

SSW, to take but one example, has 400m+ oz measured and indicated, plus 500m+ inferred resource. It has huge reserves, production, cashflow, plant and equipment etc etc. It's current market cap is around £10bn. Under the theory of the bulls here, it *should* have an implied valuation of *at least* £750bn, or a 75 bagger from current prices. Similar calculations can be done for every PGM producer on the planet.

Dunno - how much 2E PGM resource does it have? According to the "EUA not in fact wildly overvalued" theory, then every 1m oz resource should be worth anywhere between £350m - £1.5bn. Congratulations!

What on earth are you talking about? My posts in this thread have never once mentioned takeover premiums for individual companies.

It's very simple: If EUA is worth £1bn then SSW is worth $1trillion, Impala is worth $1trillion, Anglo American is worth $2 trillion and so on. How likely do you believe this to be?

Calamari: We are not talking about one company here. We are talking about and entire industry being mispriced by the market by a factor of at least 25. If EUA sells, then it means that every analyst, every trader, every bank, every brokerage, every single market participant in the world is wrong about the PGM industry on a scale unprecedented in history. Except of course for AIM tiddler EUA and its merry band of punters. They have somehow spotted the greatest single financial revaluation in human history.

As I said in the other thread, I actually hope it happens, as an EUA sale would imply a valuation for THS (which I hold) of about £10bn, or a 30 bagger for me!

A sale of EUA's 2moz measured and indicated resource, plus 15m inferred (being wildly generous here - it would *not* count as inferred under JORC) for £700m - £3bn would imply a market cap for SSW alone (400m+ measured and indicated, plus another 500m or so inferred) of about **$1 trillion**, leaving aside the fact that SSW has massive *reserves*, production and cashflow on top. So actually probably more like **$500b - $2tn**. A nice 100+ bagger for SSW holders, making it the most valuable company in the world. Vodkas all round!

What I mean by that is a valuation of EUA at £700m to £3bn *instantly* means every other miner is wildly, wildly mispriced. That is not the same thing as a gradual appreciation of an asset over time. This would be instant, massive, completely unprecedented in history and, I would suggest, completely absurd.

I

If EUA achieves a result which values the company at anything close to the current mcap, it would imply that there has been a misallocation of capital unprecedented in world history. The "next EUA" will be every single PGM miner on the planet, as they should, given an EUA sale price of £700m -£3bn, be undervalued by a factor of 25-100. Bags for everyone! Any by 'everyone' I mean the entire PGM industry, as the 3 top miners alone would be worth more than the entire capitalisation of the London Stock Exchange.

That's fantastic news. Truly puts all the squabbling over share prices and valuations in perspective; nothing is more valuable than good health and being with the ones we love. My sincerest congratulations to you both.

Kira: I know it wasn't you. To be clear, I'm saying that nobody here is anywhere near as bad as some genuinely awful people I've had to deal with in the past who did not enjoy the fact I was betting the other way to them on an investment.

I hold no ill will or grudges against anyone here, I just think that the bulls here are flat wrong and so have bet accordingly.

...actually pretty tame, I should have said.

To be 100% clear, that is one of SSW's less developed projects. They have a resource base of over 400moz measured and indicated (**not counting inferred** PGMs, so not even counting their massive production and cashflow, according to the ACF report their market cap should be somewhere around $1 trillion.

The ACF report is lunacy, as is any attempt to value MT at anything close to the current EUA mcap, let alone higher.

Riddle me this:

If MT is worth $2.4bn with 200koz 2E proven and probable reserves plus 1.8m 2E measured and indicated resources, and *maybe* 15m oz 2E inferred resources (although they absolutely would not count even as inferred under JORC), with no DFS, in a hostile jurisdiction with very little specialised infrastructure, then what is, to take a random example, Sibayne Stillwater's Akanani exploration project worth?

26.7m oz *4E* PGM indicated, 11.1m oz 4E PGM inferred, at far higher grades than MT, in a well established mining area and jurisdiction? By ACFs numbers in should be worth at a minimum double, and realistically more since far more drilling has been done. Is it worth $5bn? If so, someone had better tell SSW, as that one exploration project would represent fully 40% of their mcap.

The ACF report is completely crackers. So utterly bonkers in fact that EUA removed it from their website in embarrassment.

I distinctly remember Baron tipping me SLP at 7p and I was able to buy about 2.5m shares due to II offloading. Of course, I got bored and sold for a relatively very small profit. Kind of wish I was still holding them now!

Correction: SQZ it took about 2 years to get to 100p. The point is, it was easy to see, given a few basic calculations that SQZ would soon be generating at 5p, their entire market cap in cash every 6 months. Yet Fidelity sold out.

PIs tend to believe that institutional holders have some kind of special knowledge/are more skilled at investing than even a well-researched private investor. This is simply not the case, doubly so for pension funds, who have no specialised knowledge in the area of the market they are dealing in. Fidelity, for example, sold out of SQZ at 5p, allowing people who saw the cash flow potential to accumulate large positions. It subsequently went to 100p within a year of their sales.

The actual value of EUA's assets is in my view somewhat less than £50m. Of course, even after the failure of the FSP, the market cap will not reflect the actual value as there will still no doubt be legions of punters willing to buy in to the EUA story, whether that be attempting to develop MT themselves or exercising the Rosgeo option and kicking the can for a decade +. Said legions will, however, be considerably fewer than today's, so I'd take a guess at the mcap settling around £100-150m med term.

Apologies, I was incorrect to say there was no PFS for MT. There is. The fact remains that Sinosteel will not lend without a DFS.

Crabby:

-"- why are DLA Piper and UBS still on board?"

This argument to authority is trotted out time and again but it doesn't hold up. They are getting paid a retainer and they will stick around as long as EUA pay them. They are not risking money or reputation; if the FSP fails it will not be blamed on either of them. You'll note that no institution is actually risking money on the FSP. Blackrock's holding is entirely index tracker ETF funds. If this FSP were such a certain route to riches, where are the professionals and institutions which should be lining up to take advantage?

"-why the EGM to strengthen the BOD’s negotiating position?"

The EGM was called so they could issue more shares. That's it. That's all the resolution was. What they will use the cash raised (and there will be a raise) for is entirely up in the air - they are certainly not bound to use it for anything at all.

-"- why hasn’t the sinosteel contract been triggered for MT?"

There are numerous problems with this. Chief among them being there is not even a PFS, let alone a DFS for MT. Sinosteel will not lend the money without knowing figures like all-in sustaining costs, net present value, internal rate of return etc etc. That work needs to be done first. In addition, the Sinosteel deal does not provide for sulphur dioxide scrubbers, which are now required by law. It will need to be updated.

"- why did Dmitry move from the BoD yo head of mergers and acquisitions?"

Because he had been a very naughty boy and got the company suspended via his tweeting? Also this was 9 months ago now and no sign that its had any impact on the FSP.

"- why has the FSP not been shut down?"

Here it becomes speculation, but I suspect that they have (finally) been given a PUSU deadline by the Takeover Panel of July 1, ie a year after the FSP started. This would explain the timing of the suddenly urgent EGM. Again, this is speculation.