Beowulf Mining Share Discussion Threads

[zangdook] 21/5/2014 05:10

I was also very unhappy about the business with AGRI - IIRC BEM raised money by diluting shareholders, and then "lent" the money to AGRI. If AGRI needed money it should have been raised in AGRI's name, not BEM's. I may be remembering the detail wrong, but it was a nasty business anyway.

My holding now is a fraction of what it once was, but after that episode I don't know why I still hold any.

[superslob] 19/5/2014 17:44

Anley, re your post 14378 I see what you mean, but no longer what it means!!
It's almost as though they word things in such a way so that people give up trying to understand when trying to do exactly what you're doing now.It was certainly not
phrased like this in the RNSs.

Re AGM, it was 4th July last year so enough time for you to prepare, based on that date.

[anley] 19/5/2014 17:17

All we should be concerned with is the sum of BEM capital that was loaned to AGRI and written off.

Please have a look at the BEM accounts which you can find on the company's website.

Thank you for your comments - every little helps.

[mikes333] 19/5/2014 15:28

What substance was there to the interest in BEM from the Far East? It also never materialised.

How a person heralding himself as having experience in Capital Markets can fob off the Lanstead deal as "recommended by his/our broker" ~ confounds me.

The SID (NZ) deal appears to not of gained the fund raising required, however at the time AGRI de-listed there were +/- 160m shares in issue at 0.8p/share? Where oh where did that go? 3 Directors had been paid more than the 2010 loan from BEM I know that before de-listing!

Double dealing???

[anley] 19/5/2014 14:55

FROM a Recent FT Artile which may help readers understand the BEM funding deal...............

Aim groups look to fringe funding schemes

By Kate Burgess

A fringe of little-known financial institutions offering cash via complex funding schemes has been attracting more business from Aim-quoted companies – as conventional sources of finance remain closed off.

But while many of their esoteric financing structures have been around for a decade or more, they have only come to the attention of certain shareholders in recent days.

On May 8, Quindell Portfolio, the software insurance group, revealed a £13m equity swap derivative on its balance sheet, related to a share placing used to fund an acquisition. Its shares then fell 41 per cent in two days, before recovering, as the market struggled to assess the cost and reasons for the arrangement.

Quindell, however, is not the only company to use a share placing product. A roll call of London-listed companies, particularly miners, biotech and technology companies, have signed up to similar deals.

In simple terms, they work by allowing companies to place new shares with an institution at optimal moments, to minimise dilution for shareholders, while securing regular injections of cash for their businesses.

These products come in a variety of forms, but among the most complex and potentially expensive are those tied to derivative contracts that are designed to insure the financing institution against share price falls.

Providers of this type of finance are multiplying in London, the US, Canada, Australia and Europe.

Small cap brokers FinnCap and WH Ireland recently agreed to let Darwin Strategic, part owned by Henderson Investors, market its equity financing facilities to their clients.

Darwin is the latest recruit to a band of investors, including Lanstead and Yorkville Advisors from the US, offering cash-strapped companies access to regular funds in return for shares.

One executive from this band – who did not want to be named – estimates that a tenth of Aim companies now use these services. "We are moving from the margin to the mainstream," he says.

"A lot of companies on Aim are struggling to gain access to cash and it is impossible through more normal routes," explains a broker who preferred to be anonymous. "It has become commonplace in the resources and exploration sector which are not producing anything and have ongoing needs for capital. How else do they get the stuff out of the ground or develop opportunities?"

"For Aim and exploration companies, [funding] is always a challenge. We need diverse sources. We also need investors with the appetite for the risk of E&P."

The latest company to sign up is Red Rock Resources, which is exploring for gold and iron ore from Australia to America. Last week, the mining company, which has a market capitalisation of £5m, announced a Seda, standby equity distribution agreement, with Yorkville to raise up to £10.5m over three years.

In essence, the miner will issue a notice of when it wants to use its drawdown facility to Yorkville, which will pay out cash on an agreed formula, often linked to share volumes.

Red Rock has struck a series of similar deals with Yorkville over five years, including Sedas attached to loans paying interest at 12 per cent and Sedas with equity swaps that reduce the amount of cash Red Rock can draw down if its share price falls below set levels.

The equity swaps provide insurance for the scheme providers. "We fulfil the role between seed investors and major debt financing," explains one provider. "We are taking more risk than the banks and less than equity investors. A bank would demand security for a loan to limit downside. We use the swap to limit our downside and eliminate stock market and volatility risk."

Andrew Roberts, Red Rock's chairman, says: "For Aim and exploration companies, [funding] is always a challenge. We need diverse sources. We also need investors with the appetite for the risk of E&P. We are not an income-producing company and our cost of debt capital is high. Our cost of equity is even higher."

Sedas allow companies to raise funds when their share prices are rising. "The time when the market usually doesn't want your stock," points out Mr Roberts.

However, like so many of the companies that have taken this kind of funding, Red Rock Resources' shares have fallen sharply recently.

Critics suggest the market is wary of esoteric funding arrangements that play to the optimism of executives who believe their shares can only appreciate.

But today's providers say company boards have more control over the terms and can set floors on the price at which stock is placed. They also note that fees are lower and the products, including swap arrangements, are geared to share prices rising not falling, with constraints on shorting.

As one broker says: "These are financing tools that can be useful if part of a range of options. They just have to be fully understood and properly disclosed to the market".

So now everyone can work out how expensive this funding was. Some may say that BEM would have gone bust but the potential if that was the case could have been higher on a sensible liquidation............we will now never know.

[anley] 19/5/2014 14:39

Its a good point you make.

Have a look at the results for the year ended 31 Dec 2013 - published on the BEM website and find the audited loss and please tell me if you understand it.

Under Consolidated Statement of Cash Flow - NOTE 7 - this explains the Lanstead deal.

Without doing the home work has the company had its AGM? If not then not only will I go but that would be the time for others to come along and really quiz the directors as I have another long list of questions to put to them concerning their daily mining operations.

[superslob] 19/5/2014 13:17

Anley, although it sounds outside your intended remit, shouldn't £ that didn't reach our coffers that should have (ie some of the Lanstead £) be treated in same way as £ that was in our coffers that shouldn't have left? (Agri, bonus etc)

I realise, though, the degree of difficulty in determining exactly how much Lanstead's trading has cost us.

[anley] 19/5/2014 10:44

Thanks everyone for posting your thoughts BUT I still want as many shareholders to come up with what they think as this will help.

The following should be written to:

A letter to each member of the board to be delivered via the Company Secretary.
The auditor
The solicitor
The brokers and nominated advisers and the
Two largest shareholders

All we want is "how will the company generate a return on shareholders capital" and questions on how the board spend shareholders capital mentioning the AGRI investment write off and the expenses of CSP.

Once I have drafted a letter I will post it on this BB and give all readers just one day to submit comments before it is posted.


Any further comments?

[superslob] 19/5/2014 09:26

Thanks for that info!

[mikes333] 19/5/2014 09:25

Lets hope so, as the effect of last weeks Investors presentation does not seem to have helped at all.

[5teadyeddie] 19/5/2014 08:50

When I last spoke to Jan-Ola about 2-3 years ago he was very clear that in his mind Ballek was no mere 'sideshow', but could be the 'main event'.

Looks like he has eventually persuaded CSP that it's worth drilling: hopefully Jan-Ola is right with assay results due any day.

[superslob] 18/5/2014 20:39

Although not in same league as some of the 'dodgy' expenditure, I think we should ask why, when £ is tight and/or advanced on unfavourable terms, we're suddenly spending £ on Ballek when no work was done there IIRC during the 5 month Kallek N drilling ban period. This is even less logical when gold price has since fallen.
Can this be justified when Ballek is a mere 'sideshow'?.

On subject of justification, I think we're entitled to ask what exactly CSP brings to BEM to warrant such a salary? We were led to believe it was financial acumen, but the Lanstead deal has brought that into question, to put it mildly!

[mikes333] 18/5/2014 08:59

Are you aware of a £150,888 loan made by BEM to Agricola Resources in 2010. Loan was written off in 2012.
CSP being the executive chairman of Agricola which delisted from the PLUS market in November 2012 while simultaneously buying 75% of 3 NZ companies for US$5.1m through South Island Development (SID)- no further news since.!
Agicola expended £105K (2011) and 90K (2012) on Admin Expenses.

[anley] 17/5/2014 13:47

We seem to be getting some interesting comment coming out of the wood work which is useful when I write to all those concerned.

Keep it coming as there may be more long term shareholders as concerned as I am even though I have had made money by buying and selling BEM.

[bulldog30] 17/5/2014 10:37

Superslob He was kept behind a pillar at the infamous presentation at the Chesterfield about 3 years ago and I am sure he knows the score.

[superslob] 16/5/2014 18:27

Up until last couple of days, our criticism of BOD was along lines of incompetence, lack of urgency and being rather dismissive of PIs etc. I don't believe there's anything more sinister and I think we need to be careful about how we interpret BOD's mannerisms etc looking back with hindsight - JOL's nervousness, for eg, could simply be down to having to speak in front of an audience, and not in his 1st language either!

[mikes333] 16/5/2014 15:47

I suspect 'they' read III occasionally, thats where the biggest ramps were taking place in 2010/11 ~ all such posters now LONG gone!

Agree with proposal

[anley] 16/5/2014 15:25

Well put and I hope the board read this BB.

[reggie123] 16/5/2014 15:13

BEM + CSP + Lanstead = PI's Screwed

[tommytipple1] 16/5/2014 14:05

FAST lse just moved up

icilaterre
Posts: 28
Observation
Opinion: Strong Buy
Price: 5.63
FAST-takeover target???Today 12:46Sorry Strong Buy, not No Opinion
Reply | Recommend 1 | Report

icilaterre
Posts: 28
Observation
Opinion: No Opinion
Price: 5.63
FAST-takeover target???Today 12:45FASTNET OIL & GAS Possible Oil Majors Make An Low Ball 20p Offer !!

Dublin-based exploration firm Fastnet Oil & Gas is hopeful of beginning its planned asset disposal programme by the end of the year.
Fastnet Oil & Gas have appointed Will Holland as their new CFO and it is well known in the industry he is a deal maker. He comes from Macquarie were he completed multi - million pound deals, Paul and the team will carry on with the programme. But we remain confident that with another carried well here, as well as onshore in the country, not to mention the Celtic Sea acreage there is still plenty of upside for Fastnet.
And its looking like Mr Holland is here to take care of possible takeover acquisitions near term.
The company - which has its shares listed in Dublin and London - has a basic plan of proving viability at each of its licences in Morocco and Ireland before selling them and directly returning the proceeds to shareholders, most likely via a tender offer.
While Fastnet has one of the largest acreage positions in the Celtic Sea of any independent explorer,Management is however, still hopeful of selecting a partner to develop its Irish assets imminently.
We are hearing rumours they may have become a bid target of a number of oil majors due to their low market cap,these are thought to include Chevron, Cairn, Gulfsands Corporation, Anardarko and its current partner in Morocco Kosmos.
Each of Fastnet's licence assets if found to be containing potentially commercial flows will be sold as individual subsidiaries.

[anley] 16/5/2014 14:05

Why don't we ask the company auditors and the board as well as the brokers and adviser in writing how much all CSP trips have cost the company since the last published report and accounts.

The first port of call would be to post this open letter on this BB for as many shareholders to have there say.

Next I am happy to bear the cost of writing - with legal help - to the directors and all the other parties.

If there is no sensible response then one needs to find 10% of the shares - I believe - to call an AGM or ask for resolutions to be put forward at the AGM. As the year end is 31 December 2013 they must be auditing the books.

A suggestion.........

[mikes333] 16/5/2014 11:22

Agreed. No more 'jolly's for an under performing CSP.

Progress has been lame. The finance raise method was nothing to be proud of, but in the current climate? I had hoped it would have been raised in Sweden. I have been here 4 years and admit I did not sell any so far. Time will tell. There have been many comparisons to other IO miners posted on various boards but until we get a better JORC definition we are floating. GLALTH

[bulldog30] 16/5/2014 11:20

anley

I agree with you entirely and one has to wonder if this is just a lifestyle company for CSP. Like yourself I have invested in a few TSX listed companies over the past 15 years. Why was it necessary for CSP to spend approx. 10 days in Cape Town in February 2012,2013 and 2014 at the Mining Indaba which is almost exclusively dedicated to projects in Africa ?

Proper drilling to Measured resource for starters.....

Obviously the presentation went down a storm last night judging by today.