Member Info for wasarunner

no not the bread.

This is kind of best of both worlds day I think for HZM traders/investors. The only people it doesn't suit actually are probably long term investors who were looking to finance for an exit and who have clocks ticking. I know we have some here. I feel your pain.

I feel today gives short term traders opportunities in or out.
It gives me for example opportunity to add in Feb I wasn't expecting.
But absolutely and 100% todays news gives long term investors with a long time horizon substantially more confidence that this deal is real, it is happening, the mine will be financed. As such it is a de-risking day.

So something for (almost) everybody.

>>It doesn't really matter, if a rolling credit facility it means the £15m in the bank left over from the Orion offtake agreement can be put towards the project, similar net result.

Or, dare I say it, advancing Vermelho? I don't believe (please someone correct me if I'm wrong) the Orion money had to be spent on Araguaia. It is simply exchange of cash for a future return from Araguaia.

It would be absolutely blinder if the BOD pulled over financing of Araguaia with enough cash left over to get Vermelho permitted 21-22 :) I believe it needs circa £10m?

This might rise to above previous highs once the dust settles. I'm no trader so wouldn't like to call it but significantly further derisked I think by todays announcement. In the meantime a trading opp for some - don't begrudge them it.

I'm buying anything under 10p and anything pre financing come Feb.

Yes just wondering that about the cornerstone investor. Maybe they only need one, as the equity is expected to be so (relatively) small?

Bearing in mind that even the whole $120m is probably quite a small bite for Orion or Teck if they had to pull it out of a pocket.

I think the equipment will be $ pricey and if it comes as part of the ECA that should provide a decent tranche. I already thought the offtake could eat a significant portion of the remaining - because we will be producing $200m worth of nickel a year from Stage 1.

Very very exciting. The impatient disagree with me though. If I had spare funds I'd be buying (not selling).

Of course, the direction might actually be determined by where the BOD want to go ultimately.

1) give the shares to Teck :) if ultimately you want T/O
2) give the shares to Orion :) if you want them to protect you from a T/O

I actually expect both to participate in the equity what we are discussing really is who was first, who set the bar, who put the number on the SP at which equity (if any) will be issued. My guess is Orion. GLA

"A cornerstone investment is an agreement by an investor, usually a large institutional or sovereign investor, to subscribe for a fixed monetary amount of shares in an IPO"

I think here we are assuming it is an existing shareholder. Agreed, the financing progress slide had Teck & Glencore on for the equity piece but I just don't think it has to be so.

It doesn't matter of course in any case. We will find out in due course :)

Politely disagree. The word 'existing' is not in the RNS I am reading. 'Existing' is an assumption. And 'one major cornerstone equity investor' in this context I believe doesn't mean 'Major' being a 'Major Miner'. It means an entity able to take a 'major' equity stake.

Money still on Orion. Not that Teck might not want it also but I imagine Orion have been banging at the door to get in.

>>Being a betting man (evidently) my money remains on Orion.
The $900m cash announced Sept 2020 burning a hole in the bottom of the Fund III sack says so.

https://www.buyoutsinsider.com/mining-investor-orion-nears-halfway-point-on-fund-iiis-2bn-target/

"The Company has also negotiated a non-binding, conditional term sheet with one major cornerstone equity investor,"

A major cornerstone equity investor does not have to be a shareholder.
It could very well be a 'would be' shareholder.
Being a betting man (evidently) my money remains on Orion.

LG indeed, and for my money, they knew about the delay earlier, but wanted to progress enough aspects to be able to report something solid in December. So it was very important as a PR exercise and to demonstrate progress not to just put a delay RNS out, but to include lots and lots of positive detail that will not only reassure existing investors, but potentially tempt new ones.

I'm very happy with the update. I know where my Feb money is going.

On the H1 I think they need the space to allow effective vaccine rollout and travel to become 'normal'. Because we don't know yet how the vaccines will be rolled out/treated internationally (for example, what requirements there will be to go to Brazil based on which vaccines you have had) 6 months gives them the window that that aspect will be all done and dusted. Just my thoughts of course. But it is a lot of equipment and people crossing borders to get this project done once it is being built.

Entirely speculation on my part but FWIW I think Orion said 'we're in for x at y' on equity. First move. This potentially sets the bar for the other participants where negotiation is ongoing.

If so, I like it for multiple reasons:
- others have to match, if not, Orion get a bigger slice. They might not want Orion getting a slice with which they can control voting in the future
- it might 'guarantee' a big tranche of the equity component, therefore derisking that component and
- finally I don't necessarily think here Orion want to takeover the company. If they like the BOD and want to work with them, having them with a decent slab of equity to block hostile bids below what we might all consider worthwhile sell out point will be very very useful as we go on to develop the other projects

I think if Orion get enough equity here we may go into production and beyond as independent and that could be a very good thing for (patient) shareholders, though it may not suit those who were hoping for an early T/O. GLA

I think the update actually increases certainty that this is happening/going to happen. Yes, slightly pushed back timescales, but increased certainty. Interesting which way that takes the market. Bigger players may be more confident taking a position now? Not necessary funds but some bigger fish who normally like to enter at a point with more certainty on the table. That there is a cornerstone equity investor now is a also a big derisking step (though non binding).

Yes the question very much becomes "what else can I sell in the next 6 months to buy more of these....". I've pretty much sold everything (of value) already.

Flavour I read that too about the financing facility but I was thinking maybe that isn't for capex? That might be revolving financing. There is a lot of cost once you have built the mine and are starting to produce but you haven't shipped product yet. On the scale Horizonte will be producing you probably need a fairly chunky 'overdraft'. I read that as perhaps being this, but if it is additional capex debt so be it, the less through equity the better.

Also spelling out:

"Each part of the project finance package remains conditional until all components are in place with a simultaneous closing targeted."

This essentially means no offer of equity to PIs I think, just to put that one to bed. Really can't see them opening some of the equity up, to complete, having to set a target price for that, then having the rest of the package dependent on it. All the deals will be done behind closed doors. When it is done we will have an RNS that's it.

Also - I like the fact this came early in December. It is what a decent BOD should do - get the news out and take the uncertainty out of the uncertainty. We don't have to sit here all December trying to figure out if the financing RNS will land. I think this is an honest and transparent way of doing it - they obviously gave it some time, and it is really good that they've put a few snippets in there which are positive, but I really like that they dropped it in the first week in December.

Tuck these away in the middle draw for now and wait patiently....

>>>>Teck....Glen.....?
>>I'm thinking very much Orion. First in the queue and all that...
Just mainly because they haven't got any yet and must be chomping at the bits. Hopefully the non binding sheet sets a vague price now which the other parties will have to match or exceed!

>>Teck....Glen.....?
I'm thinking very much Orion. First in the queue and all that...

Yes really good. I particularly like the non binding agreement with the cornerstone investor - let me take an educated guess who that might be. Interesting that it is singular. Perhaps they are still negotiating with others, but right now, one big entity has signed up :) Means the equity won't be a problem IMO.

Not unexpected at all and it is the sense I got from SR though obviously he couldn't spell it out on my call. 'Subject to the ongoing impacts' is most likely how quickly they can roll an effective vaccine, any border restrictions etc.etc. this is a major international operation to get all the equipment in and people there.

It tells us this will happen for sure (subject to covid) but it is a delay and will be interesting to see what the market makes of it. Lots of impatient sellers I expect.

Also spells out in black and white - it will be one RNS in the finance package. It also reads to me a lot like this will be Araguaia (only). Vermelho will come later, maybe as Craig speculated.

I am hoping for a buying opp now in Feb, what SP? Above or below yesterdays price? Lets see.

I'm happy with end of 2023 production as even with a Q1 build start here we weren't going to get a full year of production in 2023. As long as the mine is up and running and starting to produce stuff in 2023 that's good with me. GLA