Member Info for Zarro

RedRoo - Total funding costs were $420m (+ say $30m for working capital). 50% from each JV shareholder is $210m. We have $130m available as it stands today.

Yes - too expensive by far ....BUT more pertinently it was never going to be allowed to be the source of BCN's 50% contribution to the build costs - whilst it has a priority charge on the Mine itself. The $400m funding was always going to have to be split 50/50 net of any senior debt raised (not gross) and so we were never fully funded on the BCN side - despite Secker having made clear assertions to this effect. Please see my post history going back 2-3 years where I have repeatedly banged on about this.

In my view now we can be confident that we understand why the BOD are so keen to accept the offer at 67.5p.

Looks like it D-T-R.

See my previous post regarding questions for the AGM. I fear that Secker has been less than correct with the facts when stating that we this was fully funded and our share could/would come from the RK Mine financing.

Some seemingly determined selling (hum hum) but some seemingly sticky market making (hum hum hum).......

Anyone understand how this works?

Three of mine would include:
1 - Are Citibank advisors to both Bacanora AND Ganfeng? If so, how and why is the Board comfortable with this.
2 - Has the Red Kite financing arrangement been impacted - or will it potentially be impacted - by the corporate activity and change of ownership at the BCN and/or Sonora JV level? If so, how?
3 - Why has Ganfeng apparently been willing to to be responsible for 50% of the mine costs when the BCN 50% contribution is largely met from a third party financing arrangement which is secured by a mortgage on the Mine (i.e. it is a debt which both parties are responsible for).

A little late with the disclosures aren't they?

As you say best not to speculate, and I am at risk of doing just that with the following (ha ha!)...... but my read is that (i) this issue affects just 2 of the 7 concessions that make up the Sonora Lithium project (out of 10 concessions held in total) but I do not know the economic splits of any of those (ii) the company has assumed the royalty is payable in its modelling - so this a favourable result is upside (iii) I infer the 'limitation' aspect being heard is whether BCN are time barred (Statute of Limitations?) from pursuing their claim through the courts.

Per year end accounts, the date for the hearing (to commence?) is set for tomorrow.

Jam agree with you.

Nomadic it is just that the deal was not structured as a sale of 27.5% of our interest in SLL to Ganfeng - which would have been cash to BCN. Instead SLL did its own private placing/rights issue to Ganfeng such that they ended up with 50% of the shares in the mine JV. In that structure it is cash to the JV.

Lets not forget that Ganfeng also have to bring US$200m+ to the party (although I confess that I do not understand how the RK finance of $150m counts as part of the BCN contribution given they have a first charge collateral over the mine which impacts the value of Ganfeng's interest ). In any event had Ganfeng not ponied up half the funding our dilution would have been a lot higher.

r7632 - you would be about right but BCN will only own half the mine so nearer 90-100p on the NPV basis. More, down the line on an EBITDA multiple basis. Plus whatever for Zinwald.

Col D - What is your estimate (guess?) for current annualised EBITDA run rate and valuation multiple?

My more pessimistic guess (and it is a total guess) is perhaps $100m which might put a market cap of $350-400m on the business producing an equity value of just $50-75m.....x 10%.

I guess we will have to wait for the results on 17 Nov to know....which leaves us flying a bit blind at the moment.

Does anyone have an interpretation for the chunkier after hours trades (ignoring the uncrossing UT trade).

Qd22 - I can get 35 with HL for 1500 but no bid all day for anything above that..........but have as much as you want on the offer!

What the hell happened in the first 5 minutes of trading today?

....or even 304! This is either a raging bargain or a set up for a rogering. I guess time will tell if it is Champagne or lube on the shopping list....

I understand the sentiments being expressed. Accepting that I am only a smallish holder in this at 6.5p average and so I can afford to add weight to my holding why is 5p or lower not attractive? Either I get a £1 for 80p or I have an increased holding in an interesting investment vehicle (albeit noting we would be on notice of endless dilutions to come - but that was always implicit).

In this market, and with usual level of overreaction and over-dramatisation (partly fuelled by the media) I guess anything could happen ....and it probably will.

Whilst it is true that there appear to be very few buyers even at these levels, there are also very few sellers ....so it appears to me that the price is mainly being priced down based purely upon MM's views / position. Apart from on a couple of days (which led to the subject title) the reported daily volume and value has been very low; it is almost insignificant in total over the last 3 months. Is that a normal backdrop for price falls of 50%+ ? I suppose it is until any decent level of buying re-emerges - which could be some way off.

Not clear to me why. Good trading update; Coronavirus appears contained - at least for now - as far as key event markets are concerned. No RNS re holdings. Is it simply 16/17p buyers hitting stop losses?

The points about distraction and amounts to be tied up are fair enough but the Company have had ages to get a good deal done with a third party investor / IPO....and to my mind failed to do so.

Being simple, (on the basis of VSA's numbers) if 50% of Zinwald is worth £100m (£50m at 0.5x risk factor) is it not worth £20m of our money to buy the other 50% and flip it to the alleged investor? That upside alone equates to our current market cap. Clearly there is something we do not know.....

WTF? Why on earth have they given up the option to buy the other 50%?