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AAL has already made their formal offer. We are hoping/expecting the consortium to make their indicative offer into a formal offer.

illbetabuck: "Well if they have since sold the CBs then they would appear to have no reason to support the deal, perhaps they are after pressuring AAL to increase it in order to get Polygon's support (votes?)."

Thanks, illbetabuck. Why the selling of their new CB means they have no reason to support the (AAL) deal?
Or, you mean the Alternative deal?

In case the AAL offer is accepted by a Yes vote, AAL must have made a deal with the CB owners, possibly as good as before, otherwise SM would not have a problem on the CB owner concession requested by the consortium, isn't it?

Is the price of the new CB on the current market higher than the value when they bought them?

Polygon added another 7m long in CFD, now has
598,316,902
8.523%

Yash88, thanks for the meeting update.
As the indicative alternative proposal made by the consortium had been the only other options so far (SM has reject its initial version in Dec and the revised one on the 9th of Jan), have you got any feedback/hint on this?

Time constraint would be one of the major problem, dilution is another. Why has everything be settled before the end of March? Can they get some small funding from the supporter of the alternative proposal to keep the company from bankruptcy and give the company a bit more time to complete the alterative funding path? Can they do some further down tools to save the money to give the company a few more weeks time for the alternative solution in case it is placed on the table a bit later?

On the 8th of Jan, they had
109m shares, 1.55%;
5m new CB
shorted 52m shares
reduced 17.6 shorts in CFD
added 110m long in CFD

Now (3 Feb 2020), they have
560,283,677 shares (in Cash-settled derivatives), 7.981%

Yes, they sold out their new CB.
illbetabuck, can you explain what this mean more explicitly?
How can the voting rights out of CFD be acquired (from the CFD broker that actually owner the shares?)?

590,872,800
8.417%, now the largest II of SM
Yes, they went from short to long and accumulated 590m shares in a short period of them, mainly from PIs, I guess.

ffcmember, Some articles mentioned that the voting is expected in 28 days after the firm offer.

ffcmember, A vote is a vote, no difference if it is made with or without a presence in the meeting.
I gather the difference is made on visible sentiment in the meeting room.

If there are two choices to vote, it makes sense to vote/attend. However, if the AAL offer is the only choice, then why bother (it will be a yes anyway).

illbetabuck, if the consortium will make a firm offer in next two weeks, they should notice the time constraints. Therefore, they may help to make some arrangement, e.g., giving SM a small amount of guaranteed loan for them to remain as a on going concern. Of course, all these are based on SM's willingness/preference to take the alternative arrangement. The managements may still vote for the AAL offer as promised, but they may still push ahead the alternative solution as they know the big IIs will stop it given another better offer is on the table (and the arrangement to prevent it from bankruptcy has been made).

ffcmember, yes all PI can vote in theory, but in reality I gather not many will attend the meeting or make complicated arrangement to vote through brokers. Therefore, probably only a small percentage of PI will vote. I maybe wrong, as based on my own experience.

illbetabuck, if the consortium will make a firm offer in next two weeks, a no vote to the AAL offer will not lead to a prepack administration, as by then the voting is for a choice from the two.

If the alternative proposal/offer gets over 75% yes votes, which means the shareholders believe it is variable one, and the money for the Initial Scope will be raised based on the arrangement in the proposal. SM's plan is to raise the around $600m for the Initial Scope, and therefore, the plan is executed as planned. If AAL is to involved as a strategy partner with partial ownership, that will be even better. The mine/employees wants the AAL deal as full funding solution; however, the shareholders want to be kept involved in the project to recover and grow their investment. Hope through some twists, a win-win solution is found before the last hours.

The choices will only exist/emerge if the indicative Alternative becomes a firm proposal/offer in next two weeks.

If in next two weeks, the indicative remains indicative as it currently stands, then a yes vote for the AAL offer is the only choice (as the other is administration).

If there is any partial ownership proposal/offer on the table, the AAL offer would be almost impossible to get the needed 75% of votes, to pass.

Currently, the total 7020m shares were held by big IIs (around 40%, 2800m) and smaller PIs (around 60%, 4220m). As very few PIs would be able to vote, the voting result is largely determined by the IIs.

To pass the AAL offer, 75% of 2800m shares, i.e., 2100m yes votes are needed.
Among the 2800m, Polygon and Jupiter have 1107m (i.e., 560m + 547m).
Without their support, the AAL deal cannot get the needed 75% (i.e., 2800m - 1107m = 1690m < 2100m).

If the alternative proposal is to place on the table, many other IIs should also support it.
Therefore, all the focus is now on the Alternative proposal to emerge from indicative to a firm proposal/offer, or any other proposal or offer appearing in next two weeks.

If there are two solutions on the table, i.e., the AAL one and the Alternative one; the standalone alternative one should get the support from the big IIs.

When AAL realized that another partial ownership proposal would be on the table, they cannot get enough yes vote for their offer; they may change their role back to strategy partner (with partial ownership); and due their halo factor (to ensure the funding for the deferred stage), the consortium and SM may still be happy to have a combined solution than a standalone one.

Since the RNS reports on the changes of holding, almost no big IIs sold out their shares;
Most of them kept almost all their shares. In contrast, many (long time) PIs sold (whose shares brought by other PIs and some of big IIs, such as Polygon).

Given most of PIs (more than 50%) would not be able to vote; any deal without the support of these two (over 14%) would be difficult to pass.

Does any one know the needed 75% yes votes for the AAL offer refer to 75% of votes casted, or 75% of shareholders?

560,283,677, 7.981%

Polygon might be in the consortium; Jupiter, if not in, would be the biggest II supporter of the alternative proposal.

Longtermview24, thanks, yet 28 days from the firm offer.

I still hope that the BoD recommendation was just a tactic arrangement for a backstop (it is actually a good thing that is much better than without, as it has provided some justification on the (world class tier one asset) value of the project as recognised by a major mining company) and so as to push other potential strategy-partners/investors to put forward their proposals/offers. CF has done something similar before by replacing existing arrangement (constructors) with new ones. Both of the BoD chair and CF would have a big loss with the 5.5p offer, and would be much better off with any alternative arrangement keeping the company on market. Therefore, they should have strong motivation to pursue the alternatives whenever possible. The consortium one could be a promising one as it should be supported by the big IIs, as indicated by the second largest shareholder. Through negotiation, the consortium may give up some of their conditions or requests, e.g., on the concession from CB owners or Gina, and work out a kind of win-win arrangement with SM for all the shareholders, CB holders, and other stakeholders.

"Steve Davies, manager of the Jupiter UK Growth Fund, said: 'We would like the board to pursue any alternative options, including the consortium of financial investors who submitted a proposal for a £519m funding package earlier in January, within the remaining time available.."

The consortium must have approached big IIs for support, as they seem to know some details that we do not know, e.g., £519m in the revised proposal in January. The consortium's initial proposal was in last December; and they submitted a revised proposal immediately after the AAL intended offer announcement. The consortium has shown its willingness to negotiate and adapt the proposal. Given all the SM board members have signed an irrevocable agreement to vote for the AAL, the SM managers were lack of determination to pursue the alternative proposal (as they claimed so quickly on the 8th of Jan that the alternative is not executable). Hope what they did was to get SM a backstop for them to look for better deals; rather than giving up the possibility to turn the alternative proposal into a better one.

Now only two weeks left (i.e., 28 days from the 8th of Jan) before a vote on the AAL deal.
Hope the indicative proposal could become a formal one in next two weeks (of course only if advanced discussion and negotiation between the consortium and SM), and put on the table together with the AAL one for shareholders to choose from and vote for.

The ideal situation is a combination of AAL and the consortium: a halo strategy partner plus a group of financial investors. Only big IIs could push them into such a direction. PIs as helped by the sharesoc and media may also help keeping pressure on them.

Yellow: "The above I think is where we stand - it will be interesting to see what
transpires from the proposed meeting???"

Any more information on "the proposed meeting"? for what, among whom, and when?

The Alternative proposal (9 Dec 2019) was made well before the AAL proposal (6 Jan 2020), however SM had chosen to announce the AAL proposal just two days (8 Jan 2020) after they received the AAL proposal when the AAL proposal was also just an intended non-binding offer in discussion (i.e., largely the same as the indicative non-binding Alternative proposal in discussion).

The Alternative proposal meets the expectation of the updated plan for the Initial Scope and the expectation of our PIs: with some new shares and with the mount of money needed (actually more than the amount needed: $680m > $600m as we knew from other source).

If this Alternative proposal had been announced ( i.e., an indicative $680m with some new shares) two days after it was received, e.g., on the 11 Dec 2019 as SM did for the AAL indicative offer; the SM share price would enjoy in pre Xmas rally (possibly to 8p or more), which will pave the way for an equity raise (at or above 5.5p). Even if as SM expected that the PIs would only provide around less than $100m, say $50m, that would still be enough for the SM project to keep running into April 2020. More money should be raised from the SM big IIs using the same historical analysis, plus the money committed by the financial investors of the Alternative proposal, the SM claim (i.e., the Alternative proposal is not executable before the end of March) is not convincing at all.

They rush to announce the AAL offer when it was still at an intended stage, just try to make it still look better before the SP going above 5.5p in case any information on the Alternative proposal revealed in any means.

This is not acceptable !!!

The SM response letter on this regard is not convincing (if they pushed the Alternative proposal the same way as they did for the AAL proposal, then from early Dec 2019 to the end of March 2020; there should be enough time for SM to raise some urgent money first to keep the project running; if this is tier one world class asset, further money for the deferred stage should also be raiseable).