Member Info for Valuation-it-is

Https://cornishmetals.com/site/assets/files/5388/cornish_metals_inc_-_admission_document_final_10-02-21.pdf

" Takeovers and squeeze out

6.1 Applicable Canadian rules

Although the Common Shares will be admitted to trading on AIM, the Company will not be subject

to takeover regulation in the UK (and, in particular, the Takeover Code will not apply to the Company).

However, Canadian laws applicable to the Company provide rules for takeover bids made to security

holders in various jurisdictions in Canada and for early warning disclosures, as well as methods by

which an offeror can compulsorily acquire 100 per cent. ownership of the target through a second

step transaction.

A summary of these rules is set out in paragraph 22 of Part II of this document. "

Aiminvestor

I agree with a lot of what you write, but a lot of the time the BoD and management are insiders and cannot buy or sell.

Having said that, the holdings of the BoD are pitifully small and do not and have not inspired confidence.

Looking at, and considering the logic behind recent events, - the hoped for appointment of Don Turvey, the timing of that appointment, the "find" by Securonomics in his post of 18 Aug 2024 at 11:26, Don Turvey's recent operational experience, the tidying up operations recorded at Companies House, the sale of peripheral assets, I am wondering if we are going to see the company taken private. The major shareholder, VBR, has around 26% bought at 18p. Lansdowne similarly is in at 18p. You would think they would see 6p as a good opportunity to buy.

Yet there has been no TR1 from them so no buying has taken place. If you were going to take the company private, i.e. make an offer for the whole thing, a low price would suit you. Although you know the company better than any other investor, you would probably avoid buying as it would be likely to push up the cost of going private .

VBR seem to have the firepower to take the company private and provide, secure or find the finance for going into production.

Going private would also save considerable management time and cut out a lot of cost. Listings in 2 jurisdictions with 2 sets of stock exchange regulations would be a strain for a big company, let alone a small one. Meetings of directors by international zoom rather than on site is also far from ideal.

Because of the funding timetable, I think we will find out before the end of the year whether we are to go private or stay listed. Remember the company's brokers are valuing the company at 4-5 times the current level.

................not working yet again. Companies that have management in far flung locations away from the business are repeatedly coming to grief. Zoom meetings do not cut it.

Quote from RNS "Driving cost out of the Mistral manufacturing process and component supply chain is crucial to achieving targeted gross margins.........."

Which costs need to come down?

How much do costs need to be reduced?

How do they envisage reducing those costs?

Are their plans practicable?

To what extent can per unit costs be reduced by volume increases - i.e. operational gearing impact via fixed costs?

By how many weeks will launch of Mistral be delayed?

Answers please in a presentation to investors....................................................... soon

Key in www.

then

mining.com/tin-price-on-a-multi-year-bull-run/

CFDs for 9,648 mw of projects announced today, enough for 12m homes. Mostly wind and solar. So going to need an awful lot of storage support ......................

Https://en-gb.facebook.com/100040646453601/videos/408658088204918?__so__=permalink

Table 22.5 of the 2024 PEA and the graph below it shows that for a 1% move in the tin price, the NPV of the project rises by 3%.

see https://www.lse.co.uk/rns/CUSN/filing-of-technical-report-for-south-crofty-pea-v7y4kubb1kk6fbl.html

Currently the tin price ($33,244/Tonne) is approx 7% above that ($31,000/tonne) assumed in the PEA, so the AFTER TAX NPV of the project (All other things being assumed the same) would rise by about 21% to $242m................Given there are other assets in the company which would add to that value, (i.e. United Downs, Gwinear, Cornish Lithium stake etc), consideration of the market cap of £40.4m, appears to suggest there is considerable upside on offer to investors, both existing and those that come in at the time of financing.

Source was Alphamin Resources the weblink I gave was auto-deleted.

Demand

Researchers from the Massachusetts Institute for Technology (MIT) in the United States have estimated that tin is the metal most likely to be positively affected by future technology.

Currently, tin is primarily used for soldering circuit boards, but researchers predict that tin will be the material of choice for the next generation of energy-generating and -storage devices. The explosive growth seen in recent years of new sectors, such as Artificial intelligence (AI), data centres, semiconductors and solar energy, is expected to continue.

Being the “glue” that holds all these components together, tin is a vital component in the manufacturing of all electronics including electric vehicles, advanced robotics, renewable energies, and advanced computing.

Demand for tin has historically grown at a steady 2%–3% per annum. The depletion of existing mine reserves and growing regulations have meant that global supply is unlikely to keep up with future demand.

Extract from the International Tin Association China Tin Industry Review 2023: “…the continued recovery in the semiconductor industry and slowing yet still high growth in new energy sectors will push world tin demand up by 4.4% to 376,300 tonnes in 2024, with China’s tin consumption to rise 3.9% to 189,100 tonnes. After an 8.2% slump in global semiconductor industry sales last year, a 13.1% market growth is projected for 2024 by WSTS, signaling a robust demand recovery.”

Supply

Four countries have historically produced 70-80% of global tin concentrate supply, but this is changing:

China’s mined tin output has fallen 28% over 10 years and stability is faltering

Indonesian mined tin is decreasing steadily while refined export restrictions exacerbate

Myanmar’s mined tin is decreasing while mining bans exacerbate the situation

Peru’s recently recovered mined tin may be temporary and social unrests remain a threat

China is a growing net tin importer but has constrained tin mining. In 2023, China imported an estimated 40,600t of contained tin in ores/concentrates from Myanmar, a decrease of 7,100t or 15% from 2022.

World mined tin production is under pressure, with inflationary pressures and challenging mining jurisdictions pushing up the cost curve for new entrants into the market.

Production problems in Indonesia and Myanmar, as well as the increasing cost curve, are the main drivers of the changing supply landscape:

Cost of energy, inflation and difficult mining conditions in Indonesia and Myanmar are pushing up operating costs

Indonesia and Myanmar are also facing a threat of export restrictions on tin concentrates

The tin market is suffering from severe under-investment in resources and development over the past few years. The “low-hanging fruit” has been mined out

New projects and mine expansions need to “see” a sustained robust tin price increase, with expansion projects requiring long lead times before coming into production.

Source :-

.................... looks set to flare up this week. What will the Chinese reaction be to US moves?

Argenta Production is slated to commence in 2027..................

Source RNS 15/8/2024 7.00am

"The sale of the Company's assets in northern Canada provides near-term liquidity and demonstrates our priority and focus on advancing South Crofty towards commencement of production in 2027."

But you are right we do not know what the tin price will be in 2027 either.

Battyk Do you have a link or reference for that dividend info? I can find no reference to a dividend for Osisko in the IPO document.

My understanding is that the loan was replaced by a royalty agreement . See paragraph 16.5 of Part VI of the IPO document The relevant RNS (22 Feb 2021 07:00) states:-

---------------------------------------------------------------------

Cornish Metals Inc. (TSX-V/AIM: CUSN) ("Cornish Metals" or the "Company") is pleased to announce the closing of the Company's previously announced agreement in principle with Osisko Gold Royalties ("Osisko") whereby Osisko has converted its C$7.17 million senior secured convertible note dated January 26, 2018 (the "2018 Note") into:

(i) a 1.5% Net Smelter Return ("NSR") royalty with respect to the South Crofty tin project, and;

(ii) a 0.5% NSR royalty on other mineral rights held by the Company in Cornwall (see news releases dated January 29, 2018 and January 18, 2021).

In connection with the conversion of the 2018 Note, Osisko has agreed to release the security entered into by the Company and has agreed to enter into a more simplified and reduced security package with the Company. The reduced security package is restricted to the Company's wholly owned subsidiary, Cornish Mineral Limited (Bermuda), which hold the Company's mineral rights in Cornwall.

---------------------------------------------------------------------------------------------------------

I have not found any mention of a dividend in that RNS, although the security package is not described.

Gingy and whojamaflip

If more shares are offered at a discount to the market price, that means dilution of value held - unless the offer is made to only to the existing shareholders. A rights issue achieves this perfectly. Rights to shares not taken up by existing shareholders are sold by those existing holders in the market to those who wish to become shareholders.

A placing can come close, by offering the deal to existing shareholders as well as new people. This is why it is IMPORTANT to register your interest with the company if the shares are not held in your own name at your own address/i.e. held by nominees - as will be the case if you have them in an ISA.

Do that by contacting Irene by email on info@cornishmetals.com

Pawgee/Securonomics Good afternoon, I will take a look. I guess it all refers to or arises from the changes made and announced in the RNS of 22 Feb 2021 07:00

Why it would give rise to a filing now, is another matter - of great interest! Perhaps some paperwork that was overlooked in the past.

It is clear from recent company statements (see extracts below) that a fund raise is coming. I understand a number of parties are keen to provide funding to get SC back into production. Whilst most welcome, the question for existing shareholders is - at what cost? How will the business be valued as it stands now, when that, plus the new funds arrive? i.e. what proportion of the new total will be ascribed to existing holders and what proportion to new finance providers? My view is that it was most unfortunate that shareholders voted to disapply their pre-emption rights, (encouraged to do so by the board) as that enabled discounted share offerings to be made to new shareholders without offering the same terms to existing shareholders. Having said that I would think it is the board's intention to offer known existing shareholders the same deal as that for "new boys". However it also was like an invitation to shorters to start their operations and is in my view partly responsible for the share price being around 25% of the company's broker's current valuation and approx a third of what it was after the last fund raise at 18p.

We know a fund raise is coming and if successful will enable production starting in early 2027. That raise will transform the value of the company as it will help release the net present value estimated in the PEA for SC alone, of $201m - that being after the set up and operating costs have been taken into account. So a transformational event for the company and its share price.

My advice is to make sure you have some cash available to take up any offer of shares- as a discount may be offered - and to make sure your holdings (especially if in nominee a/cs), are known to the company - i.e. notify them so they can contact you when the time comes. They cannot "see through" nominee names and it would be an unhappy investor who misses out.

The RNS of 15 August stated

"As at August 13, 2024 the Company's cash position was C$7.9 million (equivalent to £4.5 million)."

and

"The Company has allocated funding for near term opportunities to progress the project, the most significant being the purchase of the land located immediately adjacent to South Crofty surface infrastructure. As a consequence of pursuing these opportunities, additional financing will be required before the end of 2024."

Https://committees.parliament.uk/committee/78/foreign-affairs-committee/news/199060/

Gingy - "The question is, what would be a realistic takeover offer for our shares ?"

Many of us on this board are backing the company to get into production not looking for a fast buck. The outlook for the period up to 2030 and beyond is very good for this share. The company has an excellent management team in Owen Mihalop, Matthew Hird and Fawzi Hanano. It has an excellent resource of global significance, indeed a strategic asset for the West. It has all the permitting in place and much infrastructure already available. It has far less to prove than other development prospects as it has over 400 years of mining history to which to refer. It is one of very few mines coming on stream in the next few years just as tin supply goes into deficit.

Probably the biggest risk it could face is that of not getting finance to get into production. But look at the company's financial backers VBR / Lansdowne.............. Not only does Sir Mick of VBR have an enormously successful past history in mining, VBR are also sat on a large cash pile ready to invest. Furthermore VBR's financial contacts will be the best.

If you are however a short term investor looking for a quick but smaller gain consider the following. The 2024 PEA gives an NPV of the project of $201m./ £144m i.e. around 27p per share. But that excludes the value at UD and elsewhere within the company's mineral rights area. It also excludes the value of the holding in Cornish Lithium and recent discoveries

Consider also the sensitivities.

The key sensivitiy is to the tin price. The PEA assumes $31,000 a tonne. Currently the tin price is above that and rising.

Every extra 1% on the tin price adds 3-5% onto the NPV.

Look also at the PEA's discount rate 8%. Interest rates are now falling so that again may boost the NPV.

Look also at the assumed power costs - 21p per kwh. There is a very good chance they will be a lot lower than that and add considerably to the NPV.

But a hard nosed investor might say a bird in the hand is worth two in the bush.............

At this stage before financing I would think a bid would have to start at over 27 p to even be considered.i.e. the PEA SC NPV. With financing in place, 36p plus again just to be considered.

Sir Mick looks to treble or quadruple his money, so he is aiming for 54p minimum. But he and the CUSN team are looking to get this mine into production. So why not buy, then hold for the medium term, and watch/enjoy how its done?

Https://money.tmx.com/en/quote/CUSN

+30.435%

As the SP recovers, the pressure on the rumoured undisclosed shorter increases. Shorter losses mount. Will the shorter have to close their position?

As the company has recently added to its cash position, the shorter will have to be on risk longer. That is not a comfortable place to be with a rising share price.

The new CEO (s.t. employment visa) will boost the company's profile with the financial community and start spreading the word as from 1/9/24. The links between D Turvey and Sir Mick of VBR (found by Securonomic's excellent detective work) will boost confidence in the outcomes. Meanwhile tin at around $32k/tonne is usefully above the PEA assumed figure. Looking good in my opinion.................