Member Info for TigerByTheTail

For me, the worst thing about the Bergen "death spiral" is that it doesn't really resolve anything. Even $3m is nowhere near enough to get BP into production. It's just dilution going towards keeping the lights on for a few more months. It's the same with the 800,000,000 share headroom to be issued later today as well.
It's the new offtake deal that will make or break Vast(*). IMO, the new offtake needs to include a prepayment of at least $10m, even if that means giving away a percentage of BP. But that deal won't be along for "another 3 to 6 weeks", according to the most recent Q&A. So it's going to be a long painful wait.
(*) Permission to mine the Marange diamonds would also change everything, but I believe that battle has already been lost.

Hi Blearyman!
What on earth is good news for shareholders about a "death spiral" finance arrangement for a loss-making mine?
Short of an explosion in rare earth prices (no sign of that at the moment), why do you imagine the share price won't go lower as Lind sell off the shares they have been issued?!? Remember, Lind are even contractually forbidden to hold more than 10% of the company's shares, so sell they must.
I'd suggest you may need to work on your own mathematical skills.

* Not multiply, divide of course!

Yes, Bergen can convert at the current low prices. They just need five days of low prices in a row, and then they apply an 8% discount to the VWAP (Volume Weighted Average Price).
I think it's fair to say that Vast are in no position to repay Bergen and cancel the loans before they are converted.
So far Bergen have converted $500K of the first $1.5m loan. So $1m + their fee to go. Just multiply this by the conversion share price and you'll get the number of shares they will receive.
Legally, Vast can not issue shares at less than their par face value, which is 0.1p. This acts as a kind of floor for the share price. Bergen will not want to risk financing the second tranche of the loan ($1.5m) whilst the share price is anywhere near 0.1p. (That's why they put a clause in their contract saying that they could delay / cancel financing if Vast's share price was less than 0.2p). So I think Bergen T2 won't happen for some time, if at all.
Hope this helps!

I was going to make a similar point. CEY clearly lagging both against the gold price and other gold miners.
I don't see any reason why that should be, except random market factors. So I'm expecting the lag will self-correct over the next few days. I also think the pound is rather high given that absolutely nothing has been decided about Brexit yet, and a drop in the pound may also drive CEY's SP higher. So I've positioned accordingly.

I've also sold out.
I still have some hope that Rainbow will come good in the long run. But Lind will grind the share price down over the next six months or so, and there's no point in holding onto shares that you'll be able to buy back cheaper in the future.
I'll still be reading the RNSs, and may look to buy back in if and when it looks like the production run rate target will be achieved. GLA.

Hi Sumoskier!
But a lot HAS turned up recently for JLP.
Even if Kabwe vanished into thin air and was never heard of again, JLP has been making real substantive progress over the last six months, which the market simply hasn't recognised yet.
For me, it's a question of what news will it be that triggers the coming rerate. Kabwe plan? Financials? Announcement of metals reclamation partnership with mining major?

My take is that the market in JLP's shares is currently being heavily managed to ensure the orderly disposal of BMR's shares. This is, IMO, putting a lid on the share price. Anyway, the sale is almost over - only about 25m to go, I think.
After the BMR shares are gone, I also expect BMR to sell off the Kabwe royalty to JLP as well, leaving BMR a cash shell which can be closed down.
Then, finally, after all that, I hope we get news of how JLP are to put Kabwe into production.

H Dazbrad!
I reckon we'll see 0.11, but not lower today / tomorrow.
But I'm not 100% confident that today will be "the" low.
Bergen still need to convert the rest of T1 and sell off a lot of shares, and that will grind the price down in the usual "death spiral" way.
As things are now, I don't see how Bergen can go ahead with T2 - they would just drive the SP below par at 0.1p, and that creates legal problems for issuing shares. I guess they'll just wait on that until if and when the share price improves.

Looking at the board, I see lots of paired trades.
Broker trying to drive the SP higher in advance of placing?

Yes, I was hoping to see at least a month's worth of results from Mutambi. But, no, start of production delayed there.
The next six months here are going to be long and hard.

Hi Dodge!
Thanks for the quick reply. So, Vast are probably currently in breach of their loan contract with SSGI, the "cure" period for the breach (?30 days?) is ending, and Vast need to pay SSGI $900,000 pronto, or else they will lose Baita Plai. Hence the 800,000 share headroom. Even placed at a minimum 0.1p par value that equals about $1,000,000 - a sufficient sum to get SSGI off Vast's back.
Yes, I can believe all that. I expect the placing to happen as soon as the headroom is formalised.
This also ties in with a few rumours I've heard about Vast's relationship with SSGI having fallen apart.
As for the rest, it depends on getting a big upfront payment from the new offtaker. I think around $10m. Until if and when that is signed off and drawn down cash will be very tight, but Vast might be able to weather the storm.
As for the diamonds, I can't say I believe in them anymore. The Heritage licence used to belong to Anjin . Now it will be given back to them. That's how I read the runes. Remember, Anjin is a JV between some Chinese investors and Matt Bronze, the Zimbabwe military investment vehicle. After the recent riots and coup attempt, President Mnangagwa simply must keep the top army brass onside. And giving Anjin back the Heritage Concession will be a part of that effort.

Hi Dodge!
I just read one of your posts earlier today where you say that the funds from the presumed new 800,000 share placing will need to be used to pay off the $0.9m SSGI debt secured against Baita Plai.
This puzzled me a bit. Can I ask why you say this? I know that the debt was due to be paid by 31st December 2018 (but wasn't). Why would it be so urgent to pay it now - is this a breach of contract?

Hi Sandy!
Cashless in mid-December can be worked out from the first Bergen RNS. Cash balance was $1.3m after Bergen T1 ($1.5m) was drawn down. It probably explains why Vast had to turn to a death spiral financier in the first place - the need for cash was simply burning urgent. If you apply a normal cash burn rate to the last six weeks, Vast must be running low on cash again, and it will need to place again in the next two weeks (unless it cancels the trucks and it can get the $500K deposit for them back).
I agree that everybody has to make their own investment decisions. All I'd say is that it's very binary now; either investors will lose a lot or win a lot; there's no in between.

No, I don't know if Vast will go bust or not, Sandy.
I'm trying to calculate the odds of this happening right now. Because new investors here will either lose 100% of their money, or they will make a lot, depending entirely on whether Vast can get itself out of the hole it is in.
P.S. If you care to point out any factual errors in the post you're replying to, please feel free.

In truth, AP and the BOD have said a lot of stuff which has turned out to be wildly optimistic and / or deliberately deceptive.
E.g.: Anybody remember the promise not to raise money via convertible loans?
Also, in all this we should remember that even if Mercuria had come through with tranche 2 then Vast would still have been in a lot of financial trouble. $5.5m would not have been nearly enough to get BP into production ($0.9m to pay back SSGI; $3.5m BP investment; approx $3.4m G&A whilst BP was;t making any money; plus continued Manaila losses = c. $8m).
So even had Mercuria T2 arrived, Vast were considerably overstretched financially. This is a company that actually had no cash at all in mid-December, immediately before Bergen T1 was drawn.

I know this is different to what I wrote yesterday, Pepco.
I'm just trying to imagine any way at all out of the current crisis.
Certainly, something really radical needs to be done. Just pretending that equity raises and a new offtake alone will be enough to get BP into production doesn't cut it. If anybody doubts this, do the maths! The proposed new offtake would need to offer a prepayment of at least $10m to make things work, and I just don't think that's realistic.
One way or another, Vast needs surgery. IMO, either the Romanian operations or the Zimbabwe operations need to be sold off.
Anybody have any other suggestions? I'm struggling to see reasons why I shouldn't pull out my small remaining investment here.

IMO...
Sell Baita Plai for enough money to cover the $4m owed to Mercuria and the $0.9m owed to SSGI, close down Manaila entirely (it's unsellable), sell Zagra (if possible), drop Blueberry, abandon Romania entirely, cut corporate costs as much as possible.
Keep Pickstone Peerless, Giant and Eureka. They are easily worth a market cap far higher than today. Don't spend any more money on the diamonds. Wait for free cash flow to start coming in from PP and Eureka.
That saves the company.
The trouble is, AP has an enormous "perverse incentive" to do the exact opposite - to sacrifice everything in order to get BP into production and to enjoy his direct share of any profits from it.

So, I read the update.
In general, I agree with Colonel Drake's post - HUM are glossing over a lot of risk and unsolved issues. I'd be amazed if AISC comes in anywhere near the quoted target.
As for the share options, they are simply a disgrace. 5% a year of the company given away for free to incompetent and greedy management who fall for pump and dump share scams?!? It's ridiculous.
Finally, it's for this reason I am placing HUM on my uninvestable typical AIM-shit bargepole list.
Good luck all holders, but IMO there are far better gold miners out there to put your money in!

Does anybody here actually realise that BP is a minimum of 8 months from breaking even, that Manaila is loss-making, that Pickstone Peerless's profits are 100% tied up in debt repayments, that both BP and Manaila have debt on them that must be repaid ($4m and $0.9m respectively), and that Vast burn more than $500K per month in G&A costs?!?
This company needs to raise - somehow - more than its current mcap, and all without the SP dipping below the nearing par value of the shares (0.1p). Yes, some of that money may arrive via a new offtake deal, but the dilution coming here will be horrendous. And even then, there is no guarantee that Vast avoids bankruptcy. This is a very deep hole.
(Note: This assumes that the diamonds are not coming, which I think is realistic now given the various public statements by the Zimbabwe authorities.)