Norseman Gold – Another milestone reached: getting there

Share On Facebook
share on Linkedin
Print

Another week and another milestone has been reached for Norseman Gold (LSE:NGL). We are not yet at the point where we can say that the shares will return to AIM but we are getting closer. Let me explain.

As you may well remember Norseman – one of my moist disastrous share tips in a 25 year career – announced last autumn that it was putting its operating subsidiary into the hands of the administrator. This was not the same as the parent company going into administration as I explained in detail to those who assumed this was a write-off HERE

It is worth reading that piece again so that you understand the background.

On 12th March the process of administration came to an end with various creditors having now agreed to cents in the dollar write-offs. And so ownership of the subsidiary has reverted to the parent company and this will take effect by 20th March.

But in order to regain an ASX and AIM listing Norseman must now show that it has sufficient working capital to execute its latest business plan. Hopefully this business plan unlike its predecessors involves getting gold out of the ground at a profit. It is therefore inevitable that more cash will have to be raised and, having come this far, Tulla – the operator of the mines and the major shareholder will probably be the party stumping up.

And so shareholders should be expecting dilution but at that point the stock should be able to restart trading on AIM and the ASX. Self-evidently it will not fly. Indeed given the litany of failure that has marked Norseman’s market history there will be a stampede for the exit. But at least there can be an exit and if this is refinanced one assumes that its backers will see some value in it. Only when details of that financing and the business plan are made known can one arrive at a conclusion as to fair value.

But as I noted before it is not game over yet.  There will be more news next week I suspect.

Tom Winnifrith writes for 10 UK and US websites and can be followed on twitter @tomwinnifrith

He is the senior writer for ADVFN’s new service which sends out one free share tip e very working day penned by one of a panel of 20 tipsters, analysts and share bloggers. You can register for free with this service at www.onefreesharetip.com

 

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.

Leave A Reply

 
Do you want to write for our Newspaper? Get in touch: newspaper@advfn.com

By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions

P: V: D:20211204 15:27:09