Arcon Int. Share Discussion Threads

[stirkjames] 03/2/2007 12:31

Lundin Mining share price has more than halved. Has anybody any idea what has happend. Tried to Google Lundin but just got a chart, don't know were else to look.
James

[hypocrite] 06/5/2005 18:03

We are all over there now!!!

[robinbell] 13/4/2005 09:20

I've taken the money in the market. Less than the current value of the offer but I dont know what the cost to trade in Stockholm would be so I will reinvest elsewhere. Anybody suggest any good zinc plays that haven't already gone up. (And I dont want to hear Lundin Mining :-) )

Robin

[benchmark] 12/4/2005 10:49

Lundin is up 1.5% in Stockholm

[robinbell] 12/4/2005 10:42

Well they have won.

I think the rising price this morning is a bit of professional arbitrage because its easy money for them.

Robin

[robinbell] 11/4/2005 17:11

Was 3pm today the initial closing date/time? Do they have enough to take this unconditional. I hope they dont but we shall soon see!

[hypocrite] 07/4/2005 16:52

OReilly's irrevocable committment has now been announced 3 times!!!

[hypocrite] 07/4/2005 11:31

Phoenix Magazine Dublin Friday 8th April 2005


TONY BOYS'
NEW PAL
YOU'VE got to hand it to Tony
Boy. Every now and then he pulls
off a master stroke, and his sale
of Arcon to the Swedish oil
baron Adolph Lundin is one
such stroke – what ever about
for the other shareholders in
Arcon.
Those with short memories
may have forgotten that only
three years ago
Arcon was on
the rocks, bust,
hopelessly
insolvent. And
what did Tony
O'Reilly do?
He made a
virtue out of
necessity. He
got Ulster Bank
to write off no
less than €67
million owing to
it by Arcon. Brilliant. This must
have been a record of sorts.
Now thanks to the jump in the
price of zinc, Arcon is in the
money. According to Moneybags
(see page 30) it could make as
much as €50 million this year. So
Tony is getting out while the
going's good. Or so it appears. In
fact, he is getting his hands on
some badly needed cash and,
even more significantly, he is
getting into bed with the
colourful Adolph Lundin.
shareholder in a little local
company called Island Oil and
Gas, which is not unknown to
Tony Boy.
Three years ago, Tony made a
deal – well almost a deal – with
Paul Griffiths, the principal in
Island Oil and Gas. Island had a
12.5% stake in the Seven Heads
gas field, and the idea was to
back this into Tony's Providence
Resources. But the deal
collapsed at the last moment and
Griffiths had to scramble up an
alternative sale
to the
Norwegian
DNO Group.
As fate would
have it, DNO
was taken over
in turn by
Lundin
Petroleum,
which is now
capitalised at
over €1.0
billion and, in
due course, Lundin also acquired
a major stake in Island Oil and
Gas.
With O'Reilly's Providence
now having up to five drillable
targets offshore Ireland and
Island itself having three
prospects, a company like
Lundin Petroleum is needed to
step in with a rig to start a
coherent drilling programme on
both Island and Providence's
prospects. Welcome aboard,
Adolph Lundin.
Adolph Lundin Tony O'Reilly

[hypocrite] 06/4/2005 09:09

Moneybags Friday 8th April 2005

Ireland's only source of independent company appraisals
for the Irish Investor.

Phoenix Magazine
Dublin
Ireland

Arcon being
bought for a steal


IN SELLING out to the Swedish Lundin Mining Corp for
€93m, Tony O'Reilly has picked an extraordinary time to exit.
The Galmoy Mines made a small profit last year for the first
time since it was brought into production eight years ago. But
with the huge jump in the zinc price this year, Arcon is on line
to make a profit of up to €50m in 2005, making the price
Lundin is paying look ridiculous. Unfortunately, the
shareholders have not been informed about current
production levels in Galmoy or of the effect the current zinc
price has on current profitability.





With O'Reilly holding 65% of
Arcon's equity and signing an
irrevocable acceptance while the
independent directors of Arcon
and J&E Davy have recommended
acceptance, the position of the
independent shareholders is
impossible, leaving them little or
no option but to accept the bid.
The only positive aspect
of this is that almost 50%
of the offer is in Lundin
paper and, accordingly,
the minority shareholders
can participate but in a
much diluted form. The
very least O'Reilly should
do is insist that Lundin
shares – currently only
quoted in Stockholm and
Toronto – get a listing on
the London AIM market,
although the Lundin takeover
document indicates that this is
not being considered.
TEN FOR ONE
Lundin's offer for Arcon
works out at 52 cent per share,
made up of 28 cent in cash and
24 cent in Lundin paper. What is
important to note, however, is
that in July 2004 Arcon
consolidated its shares on the
basis of ten for one. This means
all prices struck before last July
had to be multiplied by a factor
of ten to compare with this 52
cent takeover offer. The offer is
as high as the shares have
reached over the last four years
and double the price of the huge
rights issue in July 2002 floated at
the equivalent of 25 cent per
share.
In total, O'Reilly has invested
well over €100m in Arcon and it
could be that, despite the huge
recovery in the zinc price, with
Waterford Wedgwood causing
him so much anxiety he cannot
resist the temptation to cash in
his Arcon chips by selling out to
Lundin now. For his 65%
shareholding O'Reilly has got
€32m cash plus the repayment of
€13m loans he made to Arcon
from his Cyprus companies,
Fairfield and Indexia, to give him
€45m cash. Even though this
represents a cash loss of well
over €50m O'Reilly will end up
with a €30m shareholding in
Lundin, making him the only
other large Lundin shareholder
(with 10%) apart from Adolph
Lundin himself, who has a 13.5%
shareholding.
Although Lundin Mining was
formed back in 1994, the
company did very little other
than part-fund an exploration
project in Northern Sweden in
partnership with Boliden to
develop a small zinc and copper
mine at Storliden in 1998, which
was brought into production in
2002. Then, in June 2004, Lundin
stepped up a league and raised
$160m (Canadian) at $8 a share.
This money (about €100m) was
used to buy the Zinkgruvan zinc
mine in southern Sweden for
€20m cash from the international
mining giant Rio Tinto Zinc (RTZ)
in June 2004. Zinkgruvan Mine
produced 62,000 tonnes of zinc
last year, along with 31,000
tonnes of lead plus 2 million
ounces of silver – almost as much
as Galmoy, which produced a
higher 69,000 tonnes of zinc last
year and 15,000 tonnes of lead.
What is odd, however, is the
observation of the senior Arcon
independent director, Paddy
Hayes, that "the Galmoy Mine
now has a commercial life of
approximately five years". He
gives no data or includes any
geological report to back up this
significant assertion. Arcon has
previously advised that Galmoy
had four million tonnes of
proven and probable reserves,
yielding 14% zinc, signifying a
zinc content of 558,000 tonnes
of pure zinc. Based on Hayes's
statement, this must mean
Galmoy is producing over
100,000 tonnes of pure zinc pa,
which is a huge increase from
the 69,000 tonnnes produced
last year.
The capacity of Galmoy's
processing plant is 750,000
tonnes of ore pa. With a 14%
zinc grading and Galmoy
working as it is now at full
capacity, this would produce
105,000 tonnes of zinc and fits
Paddy Hayes's assertion.
However, this means that last
year's results were significantly
unrepresentative and,
accordingly, in the current year
production will be hugely ahead
of 2004 with 50% higher
production and 30% higher zinc
prices.
As Arcon only
produced 69,000 tonnes
of zinc last year, at the
current zinc price this
alone will increase
Arcon's bottom line by
€17m. With the
Galmoy plant working
flat out the total profit
could rise to possibly
€50m. It is unclear why
the independent
directors – Kevin Ross,
Bill Mulligan, Peter Kidney and
Paddy Hayes – do not spell out
some of these fundamental facts.
Moreover, Lundin's own
consultants actually calculated
Galmoy's reserves at 5.5 million
tonnes grading 14% zinc,
signifying 778,000 tonnes of pure
zinc metal, almost 50% higher
than Galmoy's own estimates.
This means there is a 50%
increase in the number of years
production left in the Galmoy
mine – seven and a half years
rather than five.
Also excluded is Arcon's
other known reserves, such as
Harberton Bridge in Kildare,
which has an estimated 3.7
million tonnes grading 10% zinc,
and the Rapla Prospect adjoining
Galmoy, which has an indicated
2.7 million tonnes grading 7%
zinc.
Hayes advises shareholders
that "the Galmoy Mine now has
a commercial life of
approximately five years" and
adds that "the proven
Zinkgruvan Mine has a
significantly longer remaining
commercial life currently having
an estimated eleven year reserve
life", without giving any backup
data or geological report. It is
significant too that if Arcon
were only to produce at
Lundin's current production of
52,000 tonnes of zinc metal,
Galmoy could actually produce
for the next 12.5 years, and that
is assuming Harberton Bridge,
Rapla and the area from Galmoy
down to Lisheen are all also
ignored.
The other producing mine
Lundin has in Storliden in
northern Sweden – where the
company has just increased its
27% shareholding to 100% at a
cost of €22m – is hardly worth
talking about. According to
Hayes this only has "an
estimated remaining commercial
life of approximately three
years".
ZINC PRICE
When you consider that, on
a pro forma basis, if Lundin had
owned both of its present mines
for the whole of last year it
would have made a small profit
of only €5m, there is little to
justify its current €300m
capitalisation. The jump in the
zinc price this year will,
however, seriously increase
returns and particularly so with
Arcon contributing.
It could also be that Adolf
Lundin, an impressive operator
judging by the Zinkgruvan mine
deal, has a much better chance
of sorting out the European zinc
smelter cartel, now that he is
producing a hefty 200,000
tonnes of zinc pa. Although
Arcon shareholders are getting a
lousy deal from Lundin at least,
they are getting 28 cent in cash
per share, which is actually not
much different to what the
shares were trading at up to a
couple of months ago. The 24
cent equivalent in Lundin paper
could well be worth holding,
especially if Adolf Lundin can pull
off any more sweet deals.
It will also be interesting to
see how Tony O'Reilly rides his
10% stake in Lundin Mining and,
in particular, whether he
participates in any future fund
raising the company undertakes.

[hypocrite] 05/4/2005 08:13

This merger is by no means a done deal!!!!

[hypocrite] 04/4/2005 21:15

Well......if they have gotten more than a couple of million shares
by shaking the bushes...thats about the strength of it......
now we await the result of the postal vote....how many of us had the
good sense to kick the deal into touch!!!!

[hypocrite] 04/4/2005 15:36

nearly half a page in the business section of the Irish Times.....

basically another "I'm all right Jack!" approach.....

[hypocrite] 04/4/2005 12:23

The share price will hopefully fall....we dont want this price....
we did'nt want last weeks price......why should we want any price less
than a FAIR price and that is not 52.2 cents which has already depreciated
by 20%.......
Anyone who sells now is a MUG....plain and simple!!!

Caveat Emptor!!!

[britishbear] 04/4/2005 09:54

Hypo - are you the famous "Dillon"? Is so, well done. All good press although with the share price falling I am not so sure it was a wise move.

[hypocrite] 04/4/2005 08:54

Down 2.25p.....come on lads....you can do better......shake it baby shake....
Every cent fall in the Lundin price takes approx $1 million off the
value of the deal!!!!

Caveat Emptor!!!

[hypocrite] 04/4/2005 08:32

Good man David!!!!

Caveat Emptor!!!

[hypocrite] 04/4/2005 08:30

Me Fein = Myself Alone!!!

[hypocrite] 04/4/2005 08:25

In any case, with Lundin's stock price falling from above 13
to nearer 11$can.......the value of the deal has fallen by 15%
approx..... from
near 93 million to nearer 79 million!!!!

A serious fall in value.......
Even the Lundin shareholders seem to be ambivalent to it.....
maybe the news was in their price too!!!

[hypocrite] 03/4/2005 21:34

I understand the Sunday Business Post also published an unflattering
report on the deal today!!!
I also hear The Irish Times wont be very favourable tomorrow morning
either!!!

There is almost universal opposition to the deal it seems!!!!

[britishbear] 03/4/2005 10:54

You need to get peskier Hypo - small shareholders unite (but lose anyway)

[hypocrite] 31/3/2005 11:58

Price goes up 1.25 on 850 shares.......it'll probably fall again
for 10000....

[hypocrite] 30/3/2005 15:11

Watch for a Lundin sell off when their shareholders realise
this is'nt going through......down to $11 can on the bid at open today!!!
caveat Emptor!!!

[hypocrite] 30/3/2005 13:47

Panic...run for the doors.....mm's trying to fool you....they dont
want your shares.............
down to 28.75p .....41.75 cents at .689....on the bid now!!!!


!!!!

Caveat Emptor!!!