Member Info for wasarunner

Baggy thats the two outcomes I think possible and the likelihood of a total t/o v part sale of vermelho to me comes down to whether or not there is enough synergy between vermelho and araguaia - does a buyer want one of each type of resource within x km of each other. If not, sell vermelho (or most of it) and keep araguaia. If the 'nickel district' JM mentions on his presentations is a real thing the a total sale is a more likely outcome imo. But we will see patience required to see either outcome! Both outcomes would be very good for investors who can wait for it sale or dividends. I am with Bwana here on timescales, it may happen sooner but 4-5 years is the prime point to maximise returns because we should be in a proper nickel deficit by then. Needs patience of course and many here will want an earlier exit and thats fine there will be earlier exit points along the way without a doubt starting with araguaia financing.

I know it's early days and we'll never make it because we'll get bought out but.....
NPV of stage 2 is attractive because by building it out of FCF obviously $ for $ the FCF invested into stage 2 by Horizonte yields a greater return than, say, borrowing it at % interest rates or diluting by a bunch of shares or 'giving away' a royalty or offtake. But here's the rub - you can get stage 2 up and running much quicker if you borrow/get the money elsewhere. Like, 3-4 years earlier. How? maybe selling half of Vermelho.

I only say stage 2 is where it's at because a buyer will be interested in a 30kt operation (Araguaia) with 30 year mine life. Add another 25kt operation in Vermelho with 38 year mine life and, well, 'compelling' comes to mind which is why I think we'll get sold.

But on the off chance we don't, any exchange of part of whole of Vermelho for stage 2 Araguaia has shareholders collecting divis all the way from 2025 forever, and very large ones at that. The $232m turnover figure is FOR ONE LINE. Double it, then factor in some upside for higher nickel prices, then figure we are lowest quartile C1 producers and our £80m mcap becomes a joke. We will be able to afford to pay multiples of our mcap in dividend _from Araguaia alone_.

Stage 2 is where it's at but I have a sneaky between Stage 1 and Stage 2 we get taken out (if not earlier). GLA

they'll still take 600k off me.
They'll take 400k at above bid.
Healthy end to a day but take your point SJ, not too exciting just yet :)

around 6.56 which is obviously well below bid but on my platform it is unusual to get a firm quote on that many shares recently so MMs want them or there is a buyer lurking somewhere....

I can get a firm quote to sell 750k shares.

I'm with dj here, in the past when we've seen big moves like this later you see the background order pop through as a delayed trade. In the past these often get sold down but lets see. One day there will be enough big money buying in that it will start a rise and not stop. Maybe we closing on that point.

I expect an RNS before Christmas in any case. Would a holding RNS with a more specific timeframe for completion date provide further momentum for rise? Don't know. If the envisaged financing date is close enough, maybe, I don't think a Q1 timeframe would be badly interpreted by the market from the current SP - as I think the current SP is still pricing that the finance is not going to complete this year. We should be closer or above 10p if we thought finance complete in next 4 weeks, IMO.

It is hard to call the timescales now because:
- should be pretty clear in November that the BOD aren't interested in walking the shareprice up. No effort has been made this year (by announcing parts of deal) at all which means they are negotiating behind closed doors.
- we have unofficial confirmation of this via the call with Bwana which suggests the deal will be announced in one announcement.

Given that, you'd be a brave person to call the timing. We have to assume it _could_ be this year still because the earlier announcements suggested the aim was to close debt this year. So my position is very much - not counting on it - but believing this year is possible.

If you are in over any timeframe then it doesn't matter of course. If you are a trader with investments elsewhere hoping to get in here then you may get lucky you may not. Unless you know something the wider market doesn't, you are as likely to get the timing wrong as right.

I firmly believe 6p is cheap and equity will be done well above which means a rerate on finance. I also suspect the absolute latest finance will be completed is by end of Q1. With that in mind then anyone who is of a similar persuasion is not wanting to be out at this juncture. Why risk missing the fun? GLA

but could just be a (big) PI or two taking profit elsewhere and putting it on what is as sure a winner here as you are likely to get.

when it happens bang on 2pm I always think 'canada'. Cannacord buying seemed to happen around 2pm.

is it me or is the spread narrowing. Does that signify a move in a direction imminent? Not a trader so don't know....

course should have said - that's on an assumed 2bn shares in issue. If there is no equity issued at co level for the finance deal you can of course get your £1m at a lower sp. I just tend to work on 2bn for my calcs.

Agree with AIMtodeath here, the temptation for me to be (of course depends on your time horizon) if you're nutkins or Baggy2 at 1.75 million shares is the 'what if' 50p shareprice. It has to be doable - Onca Puma sold for $800m and we have three of those, so above £1bn valuation with the combined NPV or Araguaia+Vermelho, I don't know your personal financial situations but if you've been in 8 years, another 2-5 to get to 50p and £1m portfolio value of your Horizonte shares would persuade me to part with what it takes to get another 250k. Course now that's more expensive £15k at 6p so again personal circumstances driven not everyone has that down the back of the sofa, I no longer don't that's for sure...

Course you might decide £875k at 1.75m shares at 50p 'will do nicely' and nobody can argue with that as a return. Good luck whatever you decide!

Interesting stuff - I've never invested in early early stage miners before but I think it is the typical story - there is a lot of risk to hold from that stage through to anywhere near production because of the amount of cash developing the project burns - we talk about it now as the sum Horizonte (and Vale) spent to get the projects to this stage but of course some of that was funded by the likes of Richard Griffiths and so on and dilutive along the way. You need deep pockets or really a long long long view (and a trust in management) to enter really early. Many investors don't touch it at that stage and with good reason probably a fraction of companies eventually get to where Horizonte is today.

I think a few old timers 'got lucky' somewhat with timing, if I remember correctly craigieboy holds at a lower average than me and has been in several years more so he must have entered during the fallow years at the 1.xp prices.

Anyway onwards and upwards, I hope even those 30p purchases will 'come into the money' here in the next couple of years. But especially if they've been averaged down since. GLA

Welcome Bobby3! 2010 you've been invested circa those lapsed share options at 15.5p that just lapsed this week!

But if the next new poster is Bubbly4 I'll get suspicious here..... :)

Thanks Ivor makes sense on reflection. Obviously financing (or lack of) is a key de-risking step and so should reflect in the price.

The interesting thing then is they are saying with what we know today (which is we don't know about the finance deal other than $325 is likely to be debt) we should be at 14p. The market is seriously discounting from this number. I can only really see 2 reasons for the discount - timing (concern over delay of financing) or uncertainty over the structure of the financing (so the market is pricing a bigger risk than Peel Hunt estimate that finance will be done on less favourable terms).

For me most of the macro blockers are gone here. Covid - yes a factor - should be ok - we have vaccines. Nickel is supportive. US election has happened.

I think the market is mispricing risk (hence happy to buy at 6p yesterday) and I'm with Peel Hunt here. It would be amazing to see 33p post financing but I guess that depends on the equity etc. GLA

Does Peel Hunt's rating at 14p target (33p unrisked) mean they believe fair value is 33p but at present known risks it should be discounted to 14p in the next year? Apologies if this is a bit of a noob question but in the past I've tended to ignore broker forecasts as they were notoriously wrong (and also, varied hugely on a given stock where several were covering) but here the 12 month forecast very much reflects my own 12 month target (15p) so wondering what they mean by the 33p figure. Thanks.

yes it's annoying. Completely circumvents the nature of the transparency rules IMO. I'll just keep buying 10 shares a day forever until I own Horizonte 100% and not declare....

the sweetener for the offtake partner of course could be lock in of additional production, or a discounted price on the pre-pay. Given the nickel forecasts now, even our base case $14k/t is offering plenty of upside to the offtaker we don't have to forward sell below this.

Be interesting to see what happens post financing. Expect a proper churn of the register.

I'm hoping there are enough sticky PI's, or, alternatively, there is enough institutional interest (hopefully this is where Peel Hunt will earn their bread) that can mop up any churn selling and we stabilise at a good level above the equity deal price and then rise. What that price is of course will be determined largely by the nature of the finance deal (any new equity, is it at project level or co level) etc.

I'm hopeful on the pre-paid offtake. If we look at Araguaia it has the potential to produce 14500t nickel at full production (stage 1). At nickel price of $14k that's nearly double what is required to complete the finance package.

So you could forward sell even 5000t production, say over two years, at a modest price ($14k/t might do) and cover 2/3 of the capex gap. It would be easy to repay capex costs alongside this at full production, or, extend the time period for delivery of the offtake to reduce cash flow pressure in the early years.

If you believe half could come from offtake in any case the remaining capex requirement is not so hard to see from equity. They must be close or have just about done the deal I think.

Promised my mother in law 15p next year to turn £2k into £5k. Lets see. There's risk then there's investing your mother in laws assets, that has to be super risky proposition and could end in tears. Come on JM.