Member Info for tim000

It’s the same rule here s/t (re 90.1% rule). Any thoughts on KCN.ASX?

Interesting that the company bought back two parcels each of ca 10mn shares (in tenders?), but seemingly not a small retail sale of 175k shares which lowered the price by 0.1p. Institutional shareholder Hadron somehow has increased their holding to 11%, a show of confidence! Did they do an off market purchase? If so, where is the reduced holding RNS of the seller?

The company moved to the main board in 2014, well after the family turned up. Maybe the move required them to seek disapplication of the takeover rules again, don’t know. But they had already been disapplied on AIM.

I don’t know about that situation, cyberbub, but it’s not applicable to ALTN since there was no IPO when the family acquired its shareholding.

Without going to the rule book, the rules are that once you own at least 30% of a company you are deemed to have a controlling interest in its affairs and so have to make an offer for the entire share capital. There are also rules about the minimum offer, based on previous prices shares have been acquired. But you can apply to the authorities (the takeover panel?) to have these rules disapplied. Many listed companies are in the same boat. Personally I like the fact that the family have a controlling interest. They can get on maximising shareholder value without any distractions from know-it-all shareholders. I accept that many investors won’t share my view - in which case they will have missed out on a cracking good investment. It is of course essential in these cases that the family are honest and fair. I’ve known other family majority shareholders where that was not the case. We have 12 years of evidence to assess the Assaubayevs. I think they pass.

Share trader, just for interest is the NZ explorer you mention listed anywhere? If so, what’s its name?

The risk of going private has been discussed since the family acquired its majority stake in 2012. The family highly values its LSE listing, partly as a means of paying dividends to themselves outside Kazakhstan, and to provide a market value of the business should they ultimately decide to sell it to a larger entity, eg Polyus. I haven’t yet thought of any good counter reason why they would want to acquire the residual shares cheaply. Yes they would own 100%, but their access to Western capital markets would have ceased forever. They plan to grow the business substantially so that would be a disaster for them. It was clear at the last AGM that they highly value their PI shareholders, who determine the share price in the absence of institutional buyers. You may decide nonetheless that the family is untrustworthy. But in that case you shouldn’t invest in ALTN anyway, not because it might go private.

Sale of 9.8mn shares @ 1.3p! 2% of the share capital, 20% of the buyback capacity.

Buyback announced. Will be interesting to see what take up there is.

Share trader, I have been invested on and off in ALTN for maybe a decade and know the business well. It’s now my largest holding. The Assaubayevs make few mistakes and pay themselves almost nothing. Their aim is become a mid-tier miner listed outside Kazakhstan so they can move money outside the country via dividends etc. So very much aligned with the interests of private investors.

If you join advfn and go to post 11627 of the ALTN thread, you’ll see I have written a series of posts on the content of ALTN’s latest AGM. It gives a good account of the company and its plans.

Share trader, African Resources is the investment vehicle of the Assaubayev family of Kazakhstan. The head of the family is Kenet, the Chairman, and the CEO is Aidar, his elder son. The younger son is also a Director. The Assaubayevs bought into ALTN when it was already an established miner called Hambledon Mining, also listed on the LSE. The family founded Kazakh Gold, which they sold on to Polyus. The family are competent managers of gold mines and have very good connections with the billionaire Timur Turlov, founder of Freedom Finance and ALTN’s largest outside shareholder (and lender). Turlov owns mining assets which some day might be consolidated into ALTN, perhaps by a JV. The family wish to grow ALTN into a much larger entity and have the connections and access to capital to do so. It will just take some time.

RB, you asked about the foreign currency loss. It arises because the KZT depreciated against the $ during the half-year, reducing the carrying value of the company’s physical assets. The assets were paid for in KZT, which are now worth less in $. This is a non-cash charge, as is shown clearly in the notes to the cashflow statement. Moreover, it’s entirely misleading as in the real world the market value of the business and its assets is expressed in $, not KZT. In the real world, the company benefits from a weaker KZT because most of its costs are in KZT but its revenues are in $. So cashflow benefits from a weaker KZT whereas the P/L account suffers. The same thing will happen again in H2 as the tenge has continued to weaken.

I’ve now passed on your request Robert direct to management. I have continued to add to my holding in recent days. As mentioned, a buyback is likely at some point within the next year. As long as payments continue to be received, the share price will continue to rise and the buyback will be at around the then price. This of course provides liquidity for anyone wishing to reduce their exposure and take some profits.

Thanks Robert. I’ll pass your message on, but not immediately if that’s ok. This seems to be the COPL thread at the moment, hopefully that will pass soon. The most important thing I learned from attending the AGM is that the LOGI asset is pretty much watertight legally. It should pay out within 5 years, depending on whether Lekoil choose to invest in raising production. But recent shareholders are likely to have the option of cashing out much sooner than that via an intended buyback - which rewards those exiting and increases NAV per share for long-term investors.

Funnily enough we did discuss COPL, TR brought it up. He said he was brought in by a shareholder to represent their interests. But it soon became obvious that the equity was worthless.

Did who mention? Fenikso has not RNS’d the transaction. I imagine the Coro Directors responsible for their own RNS are aware of their suspension. The loan will have been a precondition to publishing their Annual Report and getting their shares unsuspended in August, which no doubt is why it attracted a high interest rate. As an insider, TR was more able to assess the security for the loan than other prospective funders. I am happy to back his expertise.

The loan is potentially convertible into equity and earns 20% over 6 months’ duration (ar 40%).

Fenikso has made its first investment, a c$250k loan to Coro Energy, a company in which Tom Richardson is a director.

I asked a question whether performance fees might be better linked to share prices. However, it’s not clear what share price would be appropriate, given the existing very large discount to future cashflow. Most shareholders have much higher average prices and it wouldn’t be fair to pay performance fees based on a highly depressed starting point. Logically, fees based on cashflow into the business makes more sense. And it rewards overall performance, allowing for any failures on some investments. If shareholders have any suggestions for future investments, they’re welcome to contact the company and possibly share in the fees!