The latest Investing Matters Podcast episode featuring financial educator and author Jared Dillian has been released. Listen here.
https://www.reuters.com/markets/deals/australias-newcrest-rejects-169-bln-bid-newmont-2023-02-15/
Plenty of theory’s flying around, but a couple of things that came to mind for me..
Perhaps NCM are essentially barred from buying the 5% at $60m as it doesn’t meet their returns criteria. I.e. paying for something that does not meet its ‘return hurdle critera’ is against company policy and can’t be overturned, even by SB.
To the people saying ‘then why didn’t they offer the $60m plus from SD, I don’t imagine that this was a straight forwards cash offer. If it were me I would have said, ‘OK, we’ll pay $80m to keep the 5%, but we’re going to need a written guarantee that you intend to take Havieron to mine’, etc.
Just my thoughts..
If the 20% offer Allegedly came to the table from NCM, do you suppose that this indicates that they are concerned that the valuations might not meet and they might fall on the wrong side of the independent assessors valuation?
I.e. they are putting a process in place to allow a deal to be struck as they perhaps worry that a 3rd party looking in will be able to see the true value of the asset..
I’ve been thinking exactly the same. It’s an estimate after all, so might as well put their best ‘guess’ out there..
It would probably be the final nail in the coffin with regards to the NCM relationship if there is currently any tension.
I think the 14.5p placing price is largely irrelevant to the company/asset value here, and thus what the 5% is worth. By placing at 14.5p, the board weren’t valuing the company at that, but merely using that as the best possible price to raise cash. (It wasn’t much below the actual share price at the time if I recall) which was needed for something. Perhaps they considered the dwindling share price and thought it the best time to do it before it went lower, etc.
The board may well value the company/asset at 50p a share for all we know, but you can’t do a placing above the market price as you won’t get any takers!
If anyone is feeling disheartened with CINE and a bit depressed, Let me share my trading history to make you feel better.
Bought in at 42p, sold at 50p a few days later with a quick and reasonable profit. Bought back in at 56p thinking this had some legs. Rode it all the way up to 120p, then held as I thought it would go a bit higher.
Hit the denial phase and continued to hold and added a few more around 90p thinking it had hit the bottom.
And her I still am, sat at a loss now (having been up 100% at one point) and been back in profit a couple of weeks ago when the results came out.
No one to blame but myself for being greedy. First rule in the book is to remember that a profit is a profit!
Still have absolute faith that this will come good, but looks like I’m here for a little longer then I’d wanted.
ART123. I don’t think that strictly speaking quite right is it?
Wasn’t there a share consolidation of 10:1 at some point under Roger Murphy? I seem to remember when SULA spiked (was around the time they announced the maiden JORC compliment resource) that the market cap was only ever around £15-16m. It tanked from that day (I remember it well as I was secretly dialled into the call from my work desk) and was really only downhill from then.
Can’t believe I’m back here after all these years..
Great thread. Thank you for the info.
I gather closing statements have been read, do we have an idea of when a verdict will be reached?
I know closing statements have been made, does anyone have any idea/information as to when the judge will reach a decision.
Today’s RNS and a positive outcome there (whether they appeal or not) should really get this motoring.