Member Info for wasarunner

...who bought their shares at the 2p and

No not the shares, the asset. Hindsight trading is a wonderful thing, but today we're at £25m mcap after 20:1 consolidation. Pre-finance we had £50m mcap. If we'd only invited bids at that point and not attempted to get finance deal (which was obviously hugely dilutive) lets say a 50% premium on 8p we could have had 12p (£2.40 in todays money).

Moral of the story is junior miners who haven't walked the walk before shouldn't attempt $500m mcap projects. Anyone got any counterexamples where this did work out (with this kind of capex)?

Funny thing is, I think we might have grumbled a bit back in the day 'lowball offer of 12p' etc.etc. but quietly we would all have taken the small win (bigger for those who bought their shares

I read into it that they were pretty confident a financing solution could be found WITHOUT suspending operational progress because they carried on full steam with build till now. If they had suspected finance terms were not forthcoming then as CaptainSwag suggested should have suspended operationally much sooner to preserve cash longer and be in a better bargaining position as Ni price improved (if that's what required) or everyone had done their DD and the number was known (if that was required).

Makes me wonder if:

a. the price of the overrun has gone up (hence they couldn't agree a deal in 6 weeks) or

b. just not so palatable to senior stakeholders right now with Ni price dropping 'wait and see' or

c. just too many parties at the table to get consensus. FWIW Glen as others have pointed out could probably fund the capex from loose change, they pay out $bns (multiple) in divis each year.

Who knows. I'm resigned to losing a lot of my lot, perhaps all, and will hold come what may not really worth selling up now. The only protection I see is La Mancha and Orion get 0p in most scenarios where I get 0p.

The corp video from September 28th tweet has not aged well - the funding RNS landed soon after. Also seems pointless now talking about Vermelho and A2 as this is existential. Yeah you can probably double your money from todays 10p to 20p if everything goes swimmingly but that's small consolation to LTH I guess.

I'm hoping for a 50p buyout but that might be pie in the sky, no idea.

Mv01 scenario 1 I think company ceases to exist, banks take the assets, Orion + La Mancha = 0p. I don't think it will happen. In other scenarios equity is worth 'something' but the market is betting something is a small number. I guess after the latest RNS 0p became a lot more probable than I thought was possible even a couple of weeks ago so that's the punt here now which way will it go. Impossible to say in a 'equity survives' scenario whether 10p is a good entry point because the financing landscape is now almost entirely uncertain....which is probably why long term holders such as pickedpeck sold up and didn't take the risk.

Lawrence joking aside it's a harsh lesson as I'm sure many have learnt investing before, and will learn again. Nothing specific to AIM, Horizonte, or this cycle, or anything, it's just never 100% given no matter what you think. Look at Lloyds in 2008 etc etc. My dodging the bullet was in effect diversifying into holding about 40% net wealth in Horizonte (down from 100%) after the initial funding but it hasn't worked out for me on many fronts - latterly I've been adding here as it looked closest to nailed on, so increased the position and also, everything I diversified into is on it's ar se also (and GRL is in a similar predicament to this albeit not on the same scale). So I could lose say 60% invested in the next couple of months if both go badly. Which sucks because it's a lot of money. Of all of them Horizonte did look the most solid, if a little less exciting after all the new shares were issued.

Hard to see the bright side. Weather here matches my mood - it's absolutely hoying it down. Never mind tomorrow is another day. GLA

Looking on the bright side, I always hoped we'd get back to 10p. I was once offered a smidgeon under £100k to sell 1m shares at that price, when I had 26m to sell. Well here we are again. Shame about the 20:1 consolidation in the meantime! ;)

For me the only thing that can save is us is that Orion and La Mancha don't want a $0 return. That's it. I do see our fortunes to some extent tied to theirs so lets hope they do want something back for 140p price invested.

>>£200M are £0.74 per share

Yes but only if they pay that and take on the debt.

Lawrence - I used to think even in a sale we would be ok because the NAV and what got sunk in already (which the buyer is effectively buying) must be worth a decent whack . They aren't just buying the Tier1 nickel in the ground asset they're buying a 70% complete mine with +$400m spent on it.

The problem of course is the debt - they have first dibs on the sale value no doubt with penalty clauses. So in a sale my guess is the first $300m goes to the lenders and shareholders get what's left.

It's a distressed sale so who knows. Maybe the smarter punters (no pun intended) were right and this goes to Glen for peanuts or something. I'm pretty jaded about it all tbh. It's a monumental ****up by the mgt team. If you can't develop it sell it so shareholders get something back.....

Lawrence stop derampig, we're a 2xTier1 assets. Just no cash to develop them with. what a ****show.

The banks et al have to do their DD once the engineering study is complete, that was communicated in the last RNS. The question then is, because the engineering study is material, in theory this should be disclosed to market and not await the 'final' package and the DD to complete. Because the number is likely to be quite big it isn't going to be great for the SP UNLESS they can hint at the makeup of the package. In any case I suspect the makeup of the package is already known as they've been bashing it out for minimum 6, and possibly more weeks now. So FWIW I don't think a drop in SP (if that's what happens when the engineering study lands) is particularly going to affect the package but then WDIK.

Better would be study + package in same RNS but can't see it if the lenders have to do DD.

Hi Rover, in any allocation where the cornerstones take 90% (they own less than 90% between them at the moment) then they end up with more % of the company with the more 'new' shares are issued. This is further exacerbated by the convertibles which also dilute, giving Orion and La Mancha more shares (especially Orion who own the $50m convertible).

FWIW I think the cornerstones will take a very large % of equity here then in terms of the negotiated price who knows what it will be. I'm hoping no more than £80-85m equity (so around $100m of the deficit) then I can live with 20p. Hoping for less and higher price.

One of the reasons I think equity WILL be used even though the current equity price is pants, is that if the whole lot ended up being debt/royalty it will become next to impossible to develop Araguaia2+ which is what for example La Mancha invested for, because the additional large debt burden will become expensive to service and A1 won't generate sufficient FCF to fund it.

So we're between a rock and a hard place really, but I do expect financing to get done and the SP to be higher afterwards. Even if there are 800m shares in issue after your calc vs 300m pre raise we had an mcap around £400m before the news broke it would give us c. 50p fair value SP after the raise. I'm prersonally resigned to only seeing £1+ after A2 comes online but my concern right now is how can they finance this and still build A2. There's plenty of risk here.

The interesting thing about Orion is that they are a much bigger shareholder (when you consider their $50m convertable where the option price reduced at the last dilution) than it appears from the holdings list. In a way, they stand to benefit more if dilution happens because their option price reduces over this large number of shares, than La Mancha, who only hold $15m convertable. Just something I always remind myself that Orion are really a bigger player here than their shareholding suggests and much closer to La Mancha's (virtual) holding.

Rover in the past it has often been the D+1 to update on the gold loan situation, maybe they're negotiating down to the wire ore maybe they just like to keep us sweating it a little longer. I guess if not today it'll be Monday a.m. RNS.

19p is still nuts IMO. 40p/50p/60p all acceptable for this stage and risk of funding being found but no way 19p. For even the short termers who appeared mysteriously on or around October 2 this is a bag opportunity (minimum) by year end from this price. Then depending on the path chosen further rerate as market absorbs it and we have clarity on exactly when the build /construction completes and we go into production.

Rover the funny thing is they aren't independent equations. When La Mancha invested they did so on the proviso that this would be a much bigger company than Araguaia1. So in effect now there is chicken and egg - how to fund the extra requirement for A1 while still keeping A2 'in play' because the cornerstones invested for the bigger picture and no they didn't want to shell out an extra $300m each time!

I also think it isn't an accident the A2 DFS has moved back on the funding required. Of course the A1 funding will impact A2 funding (in terms of capex for steel and things has increased for both) but actually how you finance A2 becomes fundamentally important in the A1 financing picture. If A1 royalties/etc. suck the company dry of profit then A2 becomes impossible to fund from FCF so I do really think with the cornerstones around the table a funding solution with much more than half an eye on A2 is being sought which is probably one of the reasons it is taking so long!

I don't think it is the right time to actually fund A2 but to have a plan for how to fund it based on how to complete A1 will be the big discussion at the moment I think. But a leftfield idea would combine for the funding for both but then as others have said it shouldn't involve too much equity as the equity price will be much higher with A1 producing nickel.

When the news broke early October of course it was stressful in terms of the SP action but just as concerning question for me became 'how do we now fund A2' because my investment case was very much for A2 producing. I guess we find out in a few weeks.....

>>So I'm betting on a recovery to former levels (at worst)

By which I mean, former levels in terms of SP being £1.50 I am betting will be achieved with either A1 producing at nameplate, or A1+A2 producing at nameplate. Not what anyone wanted we were here for more but running out of cash mid build and needing say $200m is going to hurt you somewhat which is what I am expecting to play out here.

Just in terms of averaging down, it's a great strategy if you have conviction in the a stock (as Dee clearly has here) and it is my strategy also, what the herd thinks has never particularly bothered me I've seen it as opportunity if others are pessimistic.

My own personal circumstances through this drought period were, I have no (significant) cash coming in for the past year or so now, and I already have a position which a. is the largest £ invested in my portfolio, is b. bit shy of 5% of the company or more recently perhaps actually 5% so I do rather well if the mine gets built ergo averaging down is just being greedy in a sense. But buying when everyone was selling was always where I made decent money so anyone buying at the 0.5p, 1p, 2p levels IMO is going to do very well when the mine gets built (or sold).

Stringer you asked on the ACP board what I thought about Horizonte. Though shock at the massive drop (still think they should have suspended at the first RNS) for a variety of reasons I've reasoned through and others here I see the current stakeholder too complicated (5-8 senior lenders including ECA, 3 cornerstone investors) for either a full corporate restructure, or 'no finance deal' as being likely outcomes as the amount of funding required (say, $200m though we don't know the figure precisely) is still only something like 25% of total capex spend when all in, of which much has already been spent. It is c. half of equity already raised and c. 66% of debt already raised and nobody will want to loose what they put in (Orion, La Mancha) to another party.

In terms of the financing deal itself of course it'll be really complicated (we are obviously hoping for a lot of royalty/debt in the deal and hopefully less equity especially at current levels) but I think value will be preserved for shareholders, how much remains to be seen but I could live with up to 1bn shares in issue post finance because if that gets A1+A2 built you are still looking at a £1.50sp potential.

So I'm betting on a recovery to former levels (at worst) and hopefully better outcomes are still possible. That makes the current shareprice very cheap, obviously.

O/T stringer but yes, I'll answer on the other board though!