Castillo Copper Share Discussion Threads

[pensionplanner] 06/8/2021 08:33

JL.
Thank you for your polite reply.

The idea that one of the more experienced investors has voiced they fear dilution, makes no sense really under the circumstances?

If the company has not got the wherewithall to raise £2.4m using the consultants and skills it also requires for an IPO then it is more a reflection on them.

The logic that one investor fears dilution makes no sense because the alternative is to have no beneficial interest in this 'transformational' asset at all, unless they cop up with paying for shares in the new company, for an asset they already held.

The company gets diluted if an asset is given away too, and the potential is much more than the £2.4m or so the company expects to get from an IPO, so the downside is much greater having an IPO than even dilution, but where even with dilution CCZ shareholders would still own the asset in question and the potential of that asset.

Failing that the directors could offer existing shareholders to raise the £2.4m in an open offer to shareholders, and even then although non subscribing shareholders who may not have the money to subscribe, would still enjoy the potential of the asset and others choosing to subscribe would also, within the umbrella of CCZ avoiding all the costs of an IPO, which in my opinion should not have been green lighted and already arranging parties to progress the IPO, without a proper discussion and vote by shareholders as its a fundamental change to the business, one that could be very poor for existing shareholders.I know they discussed the potential for an IPO previously, but not the terms, which I find inexplicable and unacceptable let alone possibly in breach of AIM, LSE and Companies Act requirements.

I've been investing for 45 years, so I don't get impressed with comments about one of the more experienced investors and no disrespect intended.

"So, unless one can be sure at this early point with NO DRILLING done at Broken Hill that its going to turn out X, Y or Z, that is "potential" as is norm.

Of course, it COULD be "transformational" - any prospect can be but UNTIL DRILLED there is no guarantee no matter how promising at this stage. I am sure that when the IPO comes out, the listing documents will show CAVEATS as usual at the end as norm."

If this were the case then one would have to question the judgement of our Board in their description of the asset, and acquiring it in the first place and the glowing RNS about Broken Hill.

[jlondon] 06/8/2021 08:21

PensionPlanner #773

Thank you for your further elucidation as its important to see it also from your point of view.

Of course, you are right, as I have already stated, that IF Broken Hill turns out to be "transformational", it may be good to keep it EVEN IF IT MEANS DILUTION etc.

On the London South East CCZ forum, one of the more experienced investors has voiced they fear dilution.

So, perhaps, go over to the London South East to make your point & if enough people think so, one can approach the co. That is fair and democractic.

I know this wont be popular. However, from my own perspective, if 1 person on Twitter has an interest in this co, one could ask him. He might have some idea given he is a mining engineer and qualified from Oz etc.

However, I cant ask the favour so I have to do my own work and that will take a long time. I dont just jump but do due diligence, so I differ but by all means, take it forward.

J.L 6 Aug 2021.

[pensionplanner] 06/8/2021 08:14

No its not straightforward, yes we have the cash, which may or may not assist developing remaining assets, but you look at the RNS announcements about Broken Hill....TRANSFORMATIONAL, so we lose what could be a multi million asset for £2.4m cash, where we've expended money on that already?

Better to finance the £2.4m or come to CCZ shareholders for it keeping it CCZ, instead of what some may consider stealing an asset from CCZ and passing it via IPO to person/persons unknown and where we only know the chairman, but do not know if our current directors will be on the board there, which would in my opinion be against Companies Act as offering terms prejudicial to minority shareholders.

Again this asset was 'transformational', so if we get £2.4m for it, and its spun off BECAUSE its a great asset, it could end up being a £100m asset for what...£2.4m of spending money for CCZ directors to use.

Better then to finance it, even if it means dilution, we would still be in a better position that not having the asset at all.

Failing that a shareholder only offer placing, as if raising £2.4m is that hard for our directors perhaps they should consider other employment.

I have not only made my position clear, I have reported it to both the LSE and the FCA as I do not believe it complies with the rules, and may be in contravention of the Companies Act regarding minority shareholders, let alone disposal of a significant asset.

I have seen similar elsewhere, and on one occasion an asset spun off, within months was worth multiples of the company that spun it off....which is OK if shareholders share in that success with what is OUR asset, but where it mentions SUBSCRIBING, its not on.

In that case why not use shareholders to subscribe for £2.4M shares in CCZ, because at least ALL shareholders would stand to gain, whether they chose to buy more shares in a preferential offer to shareholders in the same company, rather than HAVE no interest in an asset they own spun off as another company, unless they effectively REPURCHASE their own asset! Some shareholders may not have the money to do that, and would be disenfranchised, and effectively it puts existing shareholders at a distinct disadvantage, and under duress to either buy shares in the new company or face losing the potential of this transformational asset, which CCZ was so glowing about.

I get the impression that some posters are not private investors, but may be acting as spokespeople for CCZ

[jlondon] 06/8/2021 08:11

Broken Hill IPO Spin-Out.

I have looked at the Broken Hill data into more detail. However, as with ALL prospects, any geophysical anomaly, if there is one, say has to be TESTED by drilling.
So, a program of drilling has to be done which requires Stage 1 at least.

That will require A$$ or ££.

So, from any co*s perspective, they have to make a choice rather than leave the prospect. In the meantime, there are obligations under the lease - I am not privy to the exact terms of the lease.

If anyone is not happy with this and wishes to retain Broken Hill, by all means write to the co. If enough shareholders write to the co to retain Broken Hill, maybe they might change course? Again, there will have to be choice - what do they do with the Big One, Arya and 8 other prospects which are essentially COPPER.

Broken Hill, New South Wales, Australia - the historic Broken Hill mine has lead, silver etc. On the CCZ 2 licences, East & West of Broken Hill mine, they have found copper but how much of it is there, one cant tell at the moment.

I still have not decided whether I will buy into the Broken Hill IPO. One would need to find out more about the nature of the geology and more importantly the potential size, grades. One would need to have experience in this particular geology to be able to decide?

I will give an example. GGP was going to drill Ernest Giles - a major was interested. However, from the beginning it was shown that the mineralisation is under cover and that it may not be 1 ORE BODY but camps.

Someone from Solgold told us to have a look. I had a look and decided it was a difficult task etc without going into details. History now but thankfully I did not enter at that time.

So, unless one can be sure at this early point with NO DRILLING done at Broken Hill that its going to turn out X, Y or Z, that is "potential" as is norm.

Of course, it COULD be "transformational" - any prospect can be but UNTIL DRILLED there is no guarantee no matter how promising at this stage. I am sure that when the IPO comes out, the listing documents will show CAVEATS as usual at the end as norm.

Its good to discuss from different angles. However, from my point of view ONLY, I have to be pretty sure in my own research before I commit to buying the IPO or any mining stock as norm.

If one listens to people like Sprott, their Geo, Torodruk explains more as to what to look for. From my limited experience of what I have heard from them,they value from drill result? They will also have the drilling reports of Broken Hill Mine, MRE etc and more importantly, the geology etc.

DYOR. 6 Aug 2021.

[bill216] 06/8/2021 08:06

Surely if CCZ is selling part of an asset through the IPO then the resulting proceeds become an asset of CCZ in return. Therefore shareholders have that cash instead. Pretty straightforward. The issue is then does the IPO allow CCZ to get a higher value for that asset as opposed to say a farm out? I think it probably will. So i think it's a good idea. Undoubtedly the IPO value will be higher than the current Value on the balance sheet so there should be an uplift in NAV. The cash can then be used to progress other assets again hopefully increasing their value. No value is disappearing. CCZ is selling something and CCZ gets the proceeds. And we are CCZ shareholders.

[pensionplanner] 06/8/2021 07:49

tax loss: If its giving shares then I agree that is the norm and holders would have the opportunity you mention, but this does not appear to be what's happening.

It appears all shareholders get is preferential treatment to SUBSCRIBE for shares in an asset they already own via CCZ?

RNS:
(and will include a preferential SUBSCRIPTION allocation to Castillo shareholders)

[linz22] 06/8/2021 07:24

"..can't just steal something that's yours already and sell it off to somebody else".

This is 2021, not 1971.

'Tis the way of the new world and they've been ripping us off, overtly and with impunity, increasingly so over the last 50 years..!

[taxlosstone] 05/8/2021 22:45

PP When a company spins off part of its operation, the existing shareholders do not lose their interest in the hived off part, as far as I know. You will be given shares in Newco & have the opportunity to add to your holding which they say will be at a preferential rate. I have not seen all of the details but they cannot just pinch something that is yours & sell it to somebody else.

[pensionplanner] 05/8/2021 22:31

If the asset was as good as being described "transformational" it makes no sense to divest it.

The idea its benevolence to ALLOW CCZ shareholders to buy into an asset they already hold seems like snake oil salesmen commentary.

[jlondon] 05/8/2021 19:49

BROKEN HILL MINE


"In 1883, he discovered what he thought was tin, but samples proved to be lead and silver. The orebody they came from proved to be the LARGEST & RICHEST of its kind in the world.

Rasp & associates FOUNDED the BROKEN HILL PROPRIETARY CO [BHP], later BHP Billton and now B H P again, in 1885 as the Syndicate of 7."
=====

LONDON SOUTH EAST - CCZ FORUM DATA
A 5 Aug 2021 TRADE HAS SHOWN UP at 17:06 for 8 2 0, 0 0 0 shares for £16,4000!!

There were earlier buys for 50k, 50k, 100k, 275k . Just before the mkt closed the closest deal was for 3,500 shares [£66.50] & 700 shares [£13.30] at 16:23 at a SHARE PRICE OF 1.9p.

I was testing live quote just sec before the close and 1.9p was for sell. So, it would appear 8 2 0, 000 may be a BUY given the buyer had to PAY A PREMIUM at 2P?

The share price ended GREEN so it may be a buy with the price ending 1.9p/2.1p as the spread on the Lon Sth East forum data.

[jlondon] 05/8/2021 18:31

"BROKEN HILL: ONE OF THE W O R L D*S LARGEST LEAD-ZINC SILVER DEPOSITS.

-The lead zinc silver ore deposit of Broken Hill, in far-western New South Wales, is among the GREAT ORE DEPOSITS of the SIZE, RICHNESS & CONTINUITY." -Google Arts & Culture.

hxxps://artsandculture.com/exhibit/broken-hill-one-of-the-world-s-largest-lead-zinc-silver-deposits-geoscience-australia/XQKCjsU3esTMIg?hl=en
If the link is faulty, then type up the title in the search engine. Click the arrow as its gives a simple to follow history especially of the ore body.

--CASTILLO COPPER - BROKEN HILL LICENCE SET TO IPO ON THE ASX, 5 AUG 2021 RNS/ANN---
I have read the RNS more carefully, especially the geo data on Broken Hill which LIES TO THE WEST AND EAST of the Broken Hill MINE.

"Broken Hill has been mined continuously for 120 Y E A R S. 1.5km underground utilizing highly efficient BULK underground mechanised mining. CREDITS GEOSCIENCE AUSTRALIA " From the link.


I note the copper which is just about 1% cu which is what the EV industry will want. Its in the RNS of today, 5.8.21.

[husbod] 05/8/2021 17:03

Nice one - I also managed a largish top up on the use of the word Massive which I took literally. Classic example of life being a learning curve.Nicely underwater now on that top up but I'm not here for the short term so relatively sanguine about the paper loss.

[jlondon] 05/8/2021 16:50

CCZ IPO - Broken Hill [BH]5.8.21

On the London South East, the above was discussed today. In particular, Colonel Drake
on the London South East CCZ forum stated: "Overall, I think this removes the fear of heavy dilution to fund BH with capital to focus on the TBO. Makes sense but only if you THINK you have something worthwhile at TBO."

The rest is also of interest in that shareholders have a choice to buy into BH or not depending on the "PURE EXPOSURE" or "SPREAD RISK" option.

This is the 1st time I have seen Colonel Drake on CCZ but he is a experienced investor as he comes over from Solgold forum.

It is common knowledge that where a junior exploration has many projects on the go, the market will not usually price in the other projects & for this reason, even Paul Johnson is also doing spin-outs to "realise value" or rather crystallise value potentially. Generally known.

Also, Ged from CCZ has today done an AUDIO which is of interest, again, London South East CCZ sourced it first re: drilling results at Big One, Arya & Zambia.

On a more positive note, CCZ SHARES WAS +2.56% AT 1.9/2.1p per LSE.
Looking at the data from LSE [Lon Sth East CCZ], there was rather largish buys. A green day which is welcomed from after Ged*s audio interview.

Thur, 5 Aug 2021.

[fo77y] 05/8/2021 14:50

Think I must be an oxymoron for buying in here on that 'material' news rns. Material my a@$e

[2mex] 05/8/2021 11:59

Good summary pp, demonstrates they don't care about shareholders.

[husbod] 05/8/2021 11:48

Isn't that an oxymoron. Love that word almost as much as litotes.

[pensionplanner] 05/8/2021 09:56

Whilst they suggest Managing Director of the new company will be Dr Dennis Jensen, illustrating they are way down the line in this divesting of assets, but no mention of the other directors, where if Castillo directors are on the board, they earn two wages, one from Castillo without having to oversee Broken Hill, and then getting paid to oversee Broken Hill in the new company.

Its clear the board have gone far into the process, engaging IPO company's, etc., and I wonder if this has exceeded their mandate or kept to AIM rules on significant changes to a business.

Now I know this was mooted some time ago, but in my opinion should have been sanctioned before engaging costly IPO in a transaction that is in my opinion not in the best interests of my shareholding in a company which described acquisition of this asset as transformational, and where this transaction is a significant change to the business:

"Broken Hill Alliance

On 30 September 2020, in a transformational move which delivered a large footprint proximal to Broken Hill's world-class silver-zinc-lead deposit, CCZ agreed terms to acquire Wyloo Metals tenements. The acquisition delivers Castillo a commanding ground position in Broken Hill, while significant technological advances now indicate this footprint is prospective for Broken Hill Type zinc-silver-lead and Iron-Oxide-Copper-Gold mineralisation."

[fo77y] 05/8/2021 08:56

I like the 'significant minority' statement, a contradiction if ever I saw one lol well we need the drill results to come good now

[scalpface] 05/8/2021 08:07

Sitting on a stinking loss and it seems like we won't be hitting highs of 4p again...ever!? Was too much to hope that this lot doesn't become like Mick and crew at Thor mining ffs

[pensionplanner] 05/8/2021 07:40

Not sure about this latest IPO.

Castillo shareholders will get preferential treatment to buy shares in a company they already own?

If its that good, why divest it?

Is this spinning off the jam so someone else can make a fortune?

With a potential of just $4.5 (£2.4m) to $7m (£3.7m) Australian dollars for what is described as Prime assets?

Furthermore its described as a 'value creating' situation, but it doesn't look like that? It looks like disposing of a valuable asset in what could be a value destruction situation?

So why are we divesting them at all, as that way we Castillo shareholders don't need to pay for shares in an asset they already own for an asset the company describe as very prospective and a win win situation, which I don't see how it can be described as that, when its only win win if Castillo shareholders own it, otherwise its win for those who buy the spin off and lose for Castillo shareholders who already owned it.

"The spin-out and listing of our Broken Hill assets on ASX presents a win-win opportunity to advance the project and create real value for shareholders of Castillo Copper.

How can this be correct, as Castillo Shareholders will not own this asset unless they buy shares in the spin off....paying for something they already own?

With all those involved raking in money from an IPO, in my opinion we'd be better off keeping the asset and financing it, even if it meant more shares, as at least ALL Castillo Shareholders would still have a stake in it rather than obtaining £2.4m in what is not guaranteed to be a successful IPO, where I would imagine the costs are likely to be near to that to bring it to IPO, with so many fingers in the launch pie, doing nicely whatever the situation.

Better to cut out all those feeding off a prospective IPO and just raise the money via Castillo and keep it.

If its that good, although dilution isn't ideal, we should keep it. Australia is a comparatively safe geopolitical environment, which is not necessarily the case in other prospects.

Will Directors pay be cut in the event of an IPO as clearly their workload would be reduced by disposal of a 'prime asset'.

I also question the validity of the actions in engaging for an IPO when that is clearly a change in the business that requires separate mandate from shareholders before the event. Under AIM rules such an asset disposal requires that to be notified before the event, notice of intent and where apparently advisors for the disposal have already been signed on? Unless of course my own brokers, etc., failed to notify me.

[jlondon] 05/8/2021 00:35

CCZ spin out ANN, ASX.
The Lung got here first: Recommend.

[thelung] 04/8/2021 23:50

Broken Hill IPO

[jlondon] 03/8/2021 15:52

MARK BIGGS, LINKEDIN, CONSULTANT GEOLOGIST ETC

Link: hxxps://au.linkedin.com/in/mark-biggs-43999629

Quote: "Mark Biggs has had over 39 years experience...
HE IS & HAS BEEN A COMPETENT PERSON AS DEFINED BY THE JORC CODE FOR 32 YEARS."

"Mark has extensive experience in delivery geological consulting."

==
CCZ RNS*S: At the end of every CCZ RNS on assays etc, Mr Biggs signs as the Competent Person.

This is further to my post above, also today, Tues, 3 Aug 2021.

[noirua] 01/8/2021 11:08

Last Analysts coverage was on 12 January 2021