Bluebird Merchant Ventures Share Discussion Threads

[cbeadle] 15/6/2019 19:10

It’s been really interesting at BMV. Years ago the requirement for additional equity was so often taken care of by simple rights issues, putting all the shareholders on the same footing. These days it’s so often placements which favour large shareholders and institutions.
This action at BMV could be promising as it is cleaning up the balance sheet, yet in a manner highly favourable to the board, giving them much more equity. It would look that they now have more risk, but I read it quite favourably, because if they simply found another institutional placement they would not be risking more of their own cash. The fact that they have swapped their chunk of debt for equity indicates they might soon expect good progress reflected in a positive outlook for the share price They are highly incentivised now to deliver real progress.
The lack of action in the market yesterday was promising, showing most holders are waiting for further developments. I would picture the directors would start selling some of their holdings to institutional investors, or having another placing if we related rapidly to 10p on positive news of gold production

[andy] 15/6/2019 01:02

cool runnings13 Jun '19 - 15:07 - 709 of 748 0 2 0

Well I totally disagree ! When the permits arrive these will be significantly higher than 3p. Debt finance will be a very easy option for the company as numerous parties are queuing to offer this on confirmation of the permits.

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Cool,


Interesting post, have management conformed this and did they mention who any of the "numerous parties" were by any chance?

[yasx] 14/6/2019 22:24

CR continually avers that he is privy to inside information - the reality is he is not and has called this wrong for years. Just review his past offerings.

Yesterday was the latest one, when juxtaposed against the comment just now it sort of sums up his contributions (as I earlier pointed out, hard to take him seriously):

cool runnings - 13 Jun 2019 - 21:34:01 - 727 of 757
It is not 1.87p per share


cool runnings14 Jun '19 - 17:24 - 756 of 756
I agree with the 1.87p calculation

[cool runnings] 14/6/2019 17:24

I agree with the 1.87p calculation. But the process on the share conversion wasn't as simple as that. A lot of shares were issued to the previous owners of the asset so weren't against the loans as such

[enter] 14/6/2019 16:02

cool runnings USD 2,890,184 of liabilities have been converted to 121,513,516 shares. That works out to a conversion price of about 1.89p.

What calculation are you using to come to a figure of 2.5p?

[jasper2712] 14/6/2019 14:22

"I would have thought that the management have more at risk now having converted loans to equity"

Maybe they saw it as the best option to get their money back as it was never likely to be in cash. A bigger slice of the pie when it comes out of the oven is the reward.
The small investor can clean up the crumbs.

[notable] 14/6/2019 14:06

I also work out the issue price of 1.8p, a price last seen in January!. Do we also know what loans this payment refers to as I can see US$500,000 and A$250,000 or £542,000 at today's rate. The other placings had shares issued according to the RNS. Oh and digger the $500,000 wasn't virtually interest free, 8% is a good return in my book especially when its sweetened with 250,000 warrants at 2p

[notable] 14/6/2019 12:40

Anyone looked at the prospectus on the website last night which shows something happening which will result in dilution to shareholders of 49%?

[the deacon] 14/6/2019 12:08

I see it as a positive, though the prospect of more dilution before the end of next month makes me a little uneasy. It's a poor market for raising cash at the moment, and management made a terrible choice with SVS last time out

[bo doodak] 14/6/2019 11:28

Investors often tend to forget that we necessarily rely on others establishing and having the drive to ''do something'', or there would never be any available opportunities for us to pursue in the first place . We have our role, in the secondary market, to play, but we don't actually ''do'' anything.

[andy] 14/6/2019 11:23

cool runnings13 Jun '19 - 15:07 - 709 of 748 0 2 0

Well I totally disagree ! When the permits arrive these will be significantly higher than 3p. Debt finance will be a very easy option for the company as numerous parties are queuing to offer this on confirmation of the permits.

-------


Cool,


Interesting post, have management conformed this and did they mention who any of the "numerous parties" were by any chance?

[shieldbug] 14/6/2019 10:53

I would have thought that the management have more at risk now having converted loans to equity. If they had reservations about the business they likely would not have put their money at greater risk.

Investors only had to look at the balance of power by share ownership to see that too much power is in the hands of too few. Expect further dilution as they raise money to start mining and processing. I doubt that will all be debt.

Overall this seems like positive progress towards starting production and gold is rallying.

[digger2779] 14/6/2019 10:53

See people are starting to sell. If the market saw this dilution as a downward step then the share price would have suffered from the open. It clearly doesn't but the PI's selling obviously wont help short term.

[cool runnings] 14/6/2019 10:46

There are also some external parties who provided loans, associates of management who were not previously shareholders. I am sure however if management were approached with USD 2.8m in cash they would consider alternatives. No one however to date has offered to provide such. Afterall, it is not a charity. With regards to upside there are exploration companies with far greater market caps with zero chance of ever seeing gold. We are permits + $1m away from gold. At present the company generates no revenue. When it does then everything changes (positively) for the company, the share price and the future. However, whilst it generates no revenue someone has 'to carry the can' - in our case Colin Patterson has. Please name another CEO of a listed junior with the same commitment. I doubt there are many.

[jasper2712] 14/6/2019 10:11

No matter how you look at it, it is dilution. The only winners are the board they have come out with a bigger slice of the pie

[digger2779] 14/6/2019 09:23

They would have had to clear the debt one way or another. Just thank our lucky stars they didn't get into bed with the likes of Lanstead or some other death spiral finance agreement. SVS lesson hopefully learnt.
The directors have put their own money into the company and kept us going so it's only right they should get some recompense from what was virtually interest free loans. If I had a few million stashed away then I would expect a return on it from somewhere and if they took this in the form of shares at a discount then that shows confidence in the company going forward.
After all none of us have actually put money into the company we have just bought in the market and taken a gamble.

[tsmith2] 14/6/2019 09:15

cool runnings - the directors have constantly been telling us that the share price significantly undervalues the company and progress to date. Surely, they could have shown a little bit more confidence in the share price and done the conversion at say 3p to back up the above/shows greater confidence?

[overeager] 14/6/2019 08:45

My observation is that this is an example of where AIM falls down. Insiders running the business for their own benefit above the interest of other shareholders. One can only hope that the permits are granted and that we all still benefit from what should be a big upside - just not as big as it should have been.

[cool runnings] 14/6/2019 07:44

The CPR was updated not just re-dated.... also I asked them how long the regulatory process was with the FCA and said it started in the first part of 2018! I really don't understand some people and where they get their knowledge from ? Stop guessing and get some facts !

[cool runnings] 14/6/2019 07:42

A few weeks haha - really. It is an FCA process and takes many months..... you really don't get it.

[tim000] 14/6/2019 05:22

I agree. Whether or not the Directors had seniority of claims, the company would find it much easier to raise debt (and at a more economical cost) with a clean balance sheet. I see from the prospectus (p152) that the JV companies have to pay fees and royalties to a local businessman, as the project develops. I queried this some time ago, but no-one seemed to know this was the case. Had it been announced somewhere beforehand?

[bo doodak] 14/6/2019 01:16

Might it be existing debts to management would have ranked ahead of potential lenders security, and thus if there are indeed any lenders interested this obstacle was required to first be removed.

[cbeadle] 14/6/2019 00:09

Interesting news also on Southern Gold, tim000. Their direction has recently been to ditch Australia and focus on South Korea, they have several other sites they are also looking at there. They need funding for any exploration, not really easily possible in the current climate. I wonder how any announcement may influence BMV, it might even make sense for the two companies to merge and/or bring in a well resourced mining company as a partner.