Member Info for wasarunner

Baggy, they do the lot. Have a look at their website, they do everything from equity, debt, royalty, offtake and sometimes takeover the company themselves lock stock.

pickedpeck sums it up nicely it is what I'm thinking when I reflect on the video. That in Orion we potentially have 1 of the partners we would need to remain independent (accepting we probably need an engineering partner via JV on Vermelho).

I still think it could go either way but there could be a realistic chance we stay independent. If Orion like our management team, why would they want it to be taken out? They would potentially want to protect our mgt team from hostile takeover - and they can do this if they have finance/equity. If Orion get a teeth into the equity here in a big way they can potentially be a big player in Horizonte's future and both help drive and protect our future. Indeed it might be a condition for bringing to table the kind of finance needed to get Vermelho and Araguaia P2 up and running. Watch this space!

WYTT true, and (IMO only) that probably makes them more careful on future investments. I know I learned some lessons (the hard way) from investments and am now wiser for it. I expect Orion the same. Anyone in the investment game not fine tuning their strategy is probably not going to be in business soon. My guess is then enhanced their filter criteria and DD process by which Horizonte had to pass through.

One of the other panel members said 'nothing ever goes to plan' on mining projects. That is worth remembering as well. We kind of take it as a given (probably because it is open pit) that it is simple but things can still go wrong. Having a mgt team in place who can deal with adversity is pretty important. I think those credentials are what Orion and other financiers are looking for.

JDF7 - yes the way I see it is, we have a shedload of resource in the ground ($56bn to be precise at todays value). JM and team, alone, will take a while to get to the point to get it all out of there. We are a small business at the end of the day with 1 mgt team.

However, at least from the financial side, a team like Orion can be working on the financial aspect. So effectively with the right incentives the mgt team can hand off some responsibility for sourcing the next set of financing to Orion and they can go away and do some work. Of course ultimate decision making rests with our BOD but Orion become active on the 'work' side of financing.

With Vermelho then we probably need another business to run the project because our mgt team have said they can't run both. But lets assume Orion are happy with our mgt team, we are happy with them, it is a case of maybe finding a JV partner who also fits Orion's criteria, and Orion fits their criteria. Call it Teck or a.n.other.

I think Orion's game would be to try and bring as much of Horizonte online as quickly as possible for the coming Nickel boom. Why wouldn't they? The capacity is 50kt/yr+ so the sooner it is all online the sooner Orion (and by extension Horizonte and JV partner) are making money.

I think all the Orion financing contracts will be designed to allow a T/O (on favourable terms of course to them) anyway. They have to be. It still leaves door open to that approach which might come sooner or later.

https://www.youtube.com/watch?v=dRQyZddjf7o

hopefully the right one! Bit long but every bit useful I found...

Thanks NG. For anyone who didn't see the video and is in for the long term here, do watch it. I watched it with my partner last night and she is generally disinterested in the whole investment lark but she found it interesting, so that's saying something. The criteria these people use for finding projects. And the one they didn't particularly dwell on but you know is at the fore of it all - THEY ARE HERE TO MAKE MONEY. So when they invest in your project, it is going to make money (for them, and us).

The thing that impresses me about companies like Orion (and the others on the panel presenting on the 121 video) is the timescales these people plan for. When they are weighing up whether Horizonte is a good investment they are thinking 'life of mine'. This is serious money and they are looking for a long term home for it for sustained long term returns. Of course there are cycles and they can trade equity stakes in or out but for e.g. the Royalty element is for full stage 1 LOM.

That then said having them on board gives us fantastic capability to develop Stage 2 and Vermelho. Leaving to one side for a moment the possibility of takeover, what becomes clear is that there is big money looking to invest in the right project and the right management team and the right commodity. They have many filters and will only invest in quality projects. They will do far more DD than we can ever hope to do. That they picked us, and we picked them, bodes very well for the future.

Perhaps the most exciting thing about the interview was when Philip Clegg said they look for opportunities with complexity and optionality. I take this to mean, perhaps, the slightly interesting situation Horizonte have - 2 mines, each designed to be built as a phased approach (lets assume 2 phases on Vermelho too). This provides the financier with an interesting challenge of how quickly to bring online 4 distinct phases of mine project. And because Vermelho and Stage 2 Araguaia are behind in time, they could already be working on this stuff in parallel, we just don't know. But what we do know is that Orion like the project and want a big part of it.

I hope he is responsible for the portfolio containing Horizonte. His palmares reads well.

PHILIP CLEGG
PORTFOLIO MANAGER
Before joining Orion, Philip was at Pala Investments. At Pala, Philip identified, evaluated and executed a wide range of private equity transactions, and worked with a number of portfolio companies, assisting with various strategic and financial projects. He closed transactions in public and private equity, streaming, royalties, offtake and public and private debt. He also established and managed Pala’s long-short liquid portfolio. Prior to Pala, Philip was at Deloitte, where he advised on IPOs, bond issuances, M&A, and consultancy projects. Philip has a Masters degree in Earth Sciences from Oxford University.

Exciting times. I think Orion investing 15 months ago substantially de-risked us. They clearly did it to gain a foothold, there is absolutely no doubt about that from the video and JM has previously alluded to 'partnership'. They are here and here for the long haul. GLA

Is it just me or is this totally in the bag with Orion? Interesting video. I suspect the Araguaia deal (stage 1) is relatively small for Orion if the majority is debt funded but I suspect they are here to participate in stage 2 and Vermelho. Who funds builds out of fcf anyway if you have moneybags sitting by wanting piece of the action. Hopefully we just need an engineering partner for Vermelho and these guys are standing by with finance. 2 things loud and clear from the video: they like our mgt team and they like nickel. Exciting times.

"The stainless steel industry accounted for approximately 1.78 million metric tons of the primary nickel consumed worldwide in 2019."
I think Horizonte will survive. Simple reason is - world needs our product. And lots of it. And we can produce it cheaply.

whatever the equity price the guy at Orion who was smiling looks happy with it....

Bwana - I still don't see retail being offered equity - don't see the point of raising the price to the IIs to allow discount to the PIs many of whom are already invested fully expecting the IIs to pay more. If the IIs don't pay more (than market price today say) still doesn't really matter because they are unlocking the future of the mine by stumping their part of the $443m.

I also think once these guys are ready to do a deal, time will be of the essence. I can't see Mr BNP Paribas signing a $325m debt package behind closed doors somewhat dependent on whether you, I or even Mr Sponge are going to chip in our hard earned. With Mr Rodriguez pickaxe in hand waiting to lay the first foundation of the mine.

I think it is all being wrapped up with the big investors we already know about (and possibly others we yet don't), and the amount of equity required for the types of players onboard is small really. Add in offtake as well.

I expect some of the complication might actually be around Vermelho. Could the deal include it? Does the deal include it de-facto by issuing equity at company level and hence the need to squeeze every dime out of the deal?

But the one outcome I don't see is it being offered to retail. I think retail has it's chance - this is it. You're on board now, getting on board soon, or you're probably missing the train/boat/plane or whatever this is going to turn out to be....

well if it goes south of 6p she might come round with her pickaxe and it won't be to mine nickel.....

From my Monday post:
>>There's risk then there's investing your mother in laws assets, that has to be super risky proposition and could end in tears.
For the time being, my 'assets' are safe. Mother in law pleased with the 20% rise in 3 trading days. I did explain I can't guarantee this kind of return consistently.....

haha thanks Barmancy, I have some decent garden tools pickaxes etc. if JM doesn't pull a finger out and get this deal financed I'll book plane to Brazil and start extracting what's duly mine - it may take a while with basic tools but I'll get the $920m monetised eventually ;)

I own $920m of the nickel in the ground at todays nickel price. Slightly crazy, but true (pre dilution). I don't want it sold too cheap.....

indeed meant PFS - insufficient coffee at that point in the morning.

Agree with WYTT on sale value - mainly because I think the fallow years for nickel are behind us. $9m paid for Vermelho will seem like bargain of the century going into this decade. You aren't going to get Tier 1 assets cheap if the market is aligned on where nickel is going. All we need is another 5-10 year nickel cycle and hit the sweet spot for sale we can all argue exactly when that is but I suspect the cheap days for mine sales are already behind us.

Just hope we are institutionalised (share register as opposed to the other type) by 05/04/22 if cgt rules change 06/04/22. Thats when I may need to slice and would really like to be above 20p by then - feels possible but of course depends on the finance deal being thrashed out.

Agreed there will be those that sell all, those that slice (nothing wrong with that, at the end of the day Araguaia is a single resource so highly leveraged against nickel) in a single jurisdiction (Brazil) and completely get the slicing. I may need to slice for CGT reasons but that would be the only reason for me - probably in the 21/22 tax year if CGT hasn't moved by then and only on the shares outside ISA/SIPP.

On soundbuy explorer vs producer - my understanding (and again caveat little experience here of holding a miner through from explorer to producer) is it rarely happens that a junior makes it to production. In some ways it feels like Horizonte has already come further than many juniors manage independently - for example, minus the shareholdings here by Teck/Glen, we still have 100% ownership of the assets (not one but two), my understanding is at this stage many juniors are already minority ownership of the asset through JV and have had to give away stakes to get financed to prove it up. Keeping them unencumbered is a major achievement and I think JM is rightly proud of it.

I suppose the question is do we make it to production. I think on the BOD we have some very experienced directors with geological experience (e.g. Mr Bavington and Fisher) so on BOD credentials it would seem very possible. Mr Fisher was 'Vice President, Exploration for Boliden AB, a major European mining and smelting company where was responsible for thirty five projects in nine countries'. Probably well capable of helping get Araguaia through to production.

Exciting times in any case and can probably go either way :) Lets see!

Barmancy - and for some, it would do (the early sale). There'll be plenty who are happy to buy this share at 6p for a T/O at 12p - especially if they can double their money in a few months. But probably speak for a lot of the old timers here we'd like more :) I'm always in two minds about that but ultimately it won't be my decision (as I won't sell the shares unless the company sells them for me) - now that FTSE has recovered from Covid low though I would like Horizonte to stay independent a few years longer so I can get my 25-50p a share value. I don't know enough about miner takeovers to comment on when is most likely but traditionally I think majors like the mine to be built. But with where nickel is headed we may not be in 'traditional' territory here with two Tier 1 assets and it could come a lot sooner...

The other thing to bear in mind is, for some, investment in a company like Horizonte is a binary thing - they're here for the sale. They believe >50% chance we sell, when it sells it will come suddenly, so happy to play the waiting game for that day knowing on that day they make bags (literally). Happy to tie up the cash for that day and because you can't predict which day that lands you have to be invested to see it.

I'm not really of that persuasion, if we get a sale, great, but if not, you have to be invested in something with a time horizon that will give me a return on £800k invested, but you also have to be patient enough on that timescale. I still think on balance sale is more likely, but timescales are fluid, I think we would achieve best sale value in around 2023-25 when the mine is generating cash and nickel is heading into deficit. Billion dollar co then and we should sell for proper money. But in any case the underlying company has to be viable and have a plan, I couldn't ever invest 'just in case' of a sale. GLA

I first invested in Horizonte 11/04/2018. I had already made the decision to buy but moneysponge was already posting at that point on 'the other' board on Horizonte and his posts lead me to research deeper and take a bigger position. I also rate his research notes as a good starting point for newbies to start doing a bit of summary background research on a company. Not a substitute for DYOR of course.

But I concur with the view on the fintwit it is repetitive when it is daily with the same message. Especially when it's a covid stock.

However disagree on Horizonte and the posts here. When you invest in a miner, expect it to take time. Months is nothing. Progress is measured in years. Since I invested in April 2018 we've had (in no specific order):
- Araguaia DFS
- Vermelho BFS
- Orion funding
- Endevour appointed
- mine director appointed
- whole bunch of permitting / environmental
- bank mandate for £325m agreed

Most posting on the board agree we are undervalued. The speculation is always how much by, and how quickly that corrects. Because we've got skin in the game, we discuss it and turn each new interview with JM over, and analyse the language. We also comment on the nickel price moves, macro moves, US politics etc. because these all affect the investment. I am really keen to hear from the knowledgeable posters here and don't mind if they post views daily because I stand to make a huge amount here if it goes right target being £10m+ so obviously value inputs.

Another thing that gets discussed is share price moves. Often there is nothing more behind this than ebb and flow but since I've been invested:
- City Financial collapsed
- RG sold
- JPM sold out
- Lombard Odier sold out

All worthy discussion points and all affect us short term. Long term - different story.

Anyway, it's pretty simple in this game, for those needing a 100% up (or 50% down) fix a day, covid stocks are always there to be bought. Give moneysponge his dues where he sees potential he invests early and holds long, I 100% believe that. Like most smart cookies he probably also trades it a bit but that's another story.

GLA