Member Info for wasarunner

or someone mugging the sellers knowing what's coming up!

19-Feb-21 17:06:03 8.30 3,935,000 Buy* 8.10 8.40 326.61k

Nice. Institutional interest perhaps?

...contd

From 2019 accounts:

31 December 2019
Director Shares Options
David Hall 16,000,000
Jeremy Martin 28,500,000
Owen Bavinton 13,000,000
Allan Walker 13,900,000
William Fisher 13,000,000

Plus 2017 and 2018 I see 7,000,000 awarded to Simon Retter

So I make it 91.4m options are with the BOD. The rest with contractors/other employees.

The numbers are close enough to 100m for rough calc purposes - certainly at a high enough level given we don't know the final shares issued following the financing.

....contd.

I don't see an expiry on the 2011 options of which there were 14,380,000:

https://www.investegate.co.uk/horizonte-minerals/rns/award-of-options/201109210700116181O/

though they are issued in accordance with "Company's Enterprise Management Incentive Rules" which may stipulate an expiry but I can't find this documented. The option price is 15.4p so they'll have to get a shift on if these expire 21 September 2021 and they want to be in profit.

It does appear that there will be options outstanding at higher prices than the current shareprice. Maybe once they start exercising we will find out the precise number outstanding.

I did some detective work - this might not be 100% - for example, options may have been cancelled and re-issued but it is the best I can do without the company enlightening us (really should have this number up to date somewhere):

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

12 Feb 2019
136,300,000 outstanding

https://www.globenewswire.com/news-release/2019/02/12/1720698/0/en/Horizonte-Minerals-Plc-Grant-of-Options-for-Brazilian-Team.html

17 November 2020
6,500,000 lapsed? (15.5p?)

https://horizonteminerals.com/news/2010-11-17_award_of_options.pdf

24 September 2019
4,050,000 lapsed (9.5p?)

https://horizonteminerals.com/news/2009-09-25_new_option_scheme.pdf

2 Sep 2020
3,000,000 exercised

https://www.londonstockexchange.com/news-article/HZM/issue-of-shares/14672184

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

122,750,000 options remain?

The Canadian shares and options definitely take us to ~1.8bn (assuming the options are taken up one day - can't see why they wouldn't be many are at 4.8p tough others will be higher). My money is on more shares but hopefully at a higher strike price and/or for limited extra capital requirement.

On the plus side it does sound from the interview like offtakes could get announced before the funding package is complete. I never really got why that would be directly tied into an announcement at the same time as the remaining debt/equity - surely offtake can be secured/negotiated, and that feeds the debt piece. So perhaps an RNS on offtake to come?

Missed this in the RNS (must learn to read them properly):

Canaccord Genuity Wealth Management ("Canaccord") (which holds shares representing approximately 10.0% of the Company's share capital as at the date hereof) is a related party of the Company and will be participating in the Placing by subscribing for 23,930,000

So that's ~24m of the ~161m accounted for (assuming they bought the london offering and not the canadian one).

Thinking about it a TR1 at 3% on the enlarged shares in issue (assuming 0 holding previously) would be 51m shares. Perhaps no ii got that many so we may not get to see the names. That's nearly a third of the total issued via London so it assumes no more than 4-5 institutions got onboard for the average number to be greater than 51m shares here and in Canada. Will be interesting.

So they bought 7.5p and they typically might like 4x/5x return on their money call it a round 35p. Could that be a viable T/O price? It wouldn't seem unrealistic that would work with either 2bn or 2.5bn shares at Onca Puma numbers. Perhaps more with our enhanced assets then 40p-50p would give us the £1bn valuation.

35p works for me - it is a 10 bag on my average (excluding recent purchases but those are just being greedy) and I suspect many old timers here wouldn't complain at that number.

If we're going to get taken out this side of production I'd like it post finance, pre construction please. 35p in my bank account - say August/September time. Would do nicely. GLA

TR1 will be good for the shareprice when it lands, I hope, soon. I'm really interested to find out who's in.

On reflection I wonder if the cornerstone equity price (perhaps within some tight constraints) has been agreed. Reason I think that is it is significant with respect to the equity issued here. That might still act as a natural handbrake if the new ii's know it - they might not want to buy in open market much above that price.

I think the price action once the ii's are onboard will be telling and I expect 10p to be significant. I can't see PI's (who had their chance) propelling us above 10p based on the latest news. Will the new ii's? Depends on what they know. GLA

Three tier 1 groups on offtake 'nearing completion'. And he keeps mentioning the nickel price $19k/t. Hope they are getting good price on the offtake!

From the RNS

"A total of 162,718,353 new ordinary shares in the capital of the Company ("Placing Shares") have been placed with new and existing investors at a placing price of 7.5 pence per Placing Share. The Fundraise raised gross proceeds of approximately £18.0 million for the Company......approximately £12.2 million from the Placing and approximately £5.8 million from the Canadian Offering."

I don't think the 162m can include warrants-to-be-converted as 162mx0.075=£12.15m. So the new shares in issue I think represents the UK portion of the raise with the canadian portion to come which will get us to 1.7bn shares. I'm then allowing for ~100m options, Anna hasn't got back to me yet on that one - to get to 1.8bn potential share capital before the final raise.

We'll see. I'll be happy with every share less than 2.5bn in final issue. GLA

Ivor - just personal view - the reason these ii's went for the placing was the cornerstone has an agreement they've seen (it could be higher, or same price). What is interesting me is - did Orion get in this round. If not, then I think Orion is the cornerstone and they get in next round. Whether it's 7.5p, 10p, 15p, who knows.

So I'm allowing for more shares - 700m in fact but it is just conjecture. 1.55bn (inc options) + 240m (placing) gets us ~1.8bn. + 700m would give us 2.5bn. 700m raised at 7.5p would raise just over $50m.

These might be worse case figures and it could end up much better. I had hoped they'd leverage Vermelho to get better numbers - they haven't this round, maybe they can next round.

I can live with 2.5bn shares but it means obviously slightly less pie down the road. What I do like is getting on with it and in that vain I really hope they get on with Vermelho also. For anyone invested here for proper returns, we want the mines producing. So some dilution now, for early(ish) production is an acceptable compromise IMO. Of course that doesn't suit the traders as much and I suspect they're selling....

>>14% of Vermelho's NPV would have been $280m

I'm going to use 2.5bn now for the basis of my calcs, it feels a safer (less optimistic) figure than 2bn. It is what I used back in the day anyway, but I had hoped for better, of course. We will know the answer in any case in a few months time.

My feeling is with 2.5bn shares Araguaia itself might get us to 20-30p at production. Therefore if this many shares are in issue we need Vermelho progress on favourable terms to get us higher. 30p would be a fairly full NPV valuation but of course allows upside for S2 of Araguaia.

This financing package does pretty much guarantee the mine will get built because I don't see the ii's taking the placing without substantial assurance of that outcome. I do wonder whether the reason for the placing is the lost time and cash burn - whether the Orion money was originally intended for this purpose but not enough could be retained to get us to production. Either way the reason is moot now.

The mine gets built, the NPV is unlocked. Giving away 14% of Vermelho for $25m still hurts a bit though. At todays nickel price 14% of Vermelho's NPV would have been $280bn. It does feel a bit cheap.

All that said I bought some, will buy again 1st March if still below 10p, and will also ISA the lot and hoping for sub 10p come 6th April. GLA

Nickel 19,487.50 19,532.50

Next stop $20k/t

nm

The assurance could be that the cornerstone has agreed a higher (than 7.5p) price. I can see that potentially being one of the main reasons for the cornerstone agreement - that they couldn't do this one without it.

There will be see saw for sure but I broadly see the announcement as positive. It wouldn't surprise me (per Vaux) if we then eventually re-rate upwards. Not to say there won't be a dip, or more than one.

I haven't got serious funds to play with but if main finance package lands later than 6th April, and it does seem that way from this announcement, then I'm not complaining. I always thought main finance would land Q2. This just gets the process going....

what SP at close on Friday? I'll start. 9p.