RE: RE : And So It Starts4 Jul 2024 11:42
Securonomics.
I think the major factor to consider is funding. If CUSN can get the funding it needs it is likely to produce a very large return for investors from South Crofty (SC). It will also be able to develop its other assets at United Downs, (UD), Gwinear etc. producing further returns.
In doing so it will provide the West with an invaluable resource - a metal critical for our drive to electrification. It will also provide incomes and employment for hundreds of people in an area of the UK which needs jobs and exports for the UK.
Without going into the mechancs of this, by driving the share price down, shorters hope to stop CUSN from raising the funding from equity, lead it to fail, thus making their shorts very valuable. Putting out rumours and innuendo is one way they might seek to do this. In my opinion, shorting can be just the expression of a pessimistic view of an investment - indeed is the opposite of buying, and is welcome, but when it starts to use underhand tactics by spreading false information it is despicable, interfering with the proper functioning of the market - i.e. the efficient allocation of capital . I suspect there are some minor players of this despicable game about.
They do run the risk of losing all their money and more if they have uncovered shorts, which I suspect. That loss would come about if the company succeeds in raising its funding from other sources such as debt finance, off-take agreements, or Government funding - US or UK through the likes of DoE,(US) or UKIB etc.
My view is the project is an attractive, worthwhile investment but not without risk.
Don't just take my view. Think also about the big backers. Take the biggest for example. VBR has put in £25m at 18p per share, when the resources were far less proven, when the NBV of the project was a lot less and before the Wide formation had been found. They got about 26% of the company for their money. Now, following the sale for fund raising purposes of a different major investor, the remaining 74% is valued at less than £22m. VBR have raised 600m recently. What would you do if you were VBR and you could see the tin price rising and pushing the value of CUSN up as a result? Every 1% rise in the tin price adding 3% to the value of the SC NBV?
Who would you back - Sir Mick and his team of consummate professionals loaded with cash, or some minor shorting outfit ?
For those who want to sit on the fence - What negatives are there? A highly regarded and successful BoD but with few shares. A BoD based on another continent in another time zone, and a difficult funding environment. What is your view?
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