Chaarat Gold Share Discussion Threads

[casual47] 27/11/2018 11:40

Also, the original suspension was for Kumtor. Since then there is Kapan, which was announced only recently, so they will probably make some allowance for the fact that the whole RTO process is starting over again and that it may take some time to get the AIM admission documents ready.

Our BOD probably has some ability to slow down or speed things up as required. They will not be in a hurry to get suspension lifted if that would potentially damage the completion of the loan notes offer or the project financing.

I would say that possibly it has been pretty handy to have the share price fixed at the price it was...Might have been a lot more difficult to do had it been at 15p, where it was not long before.

[2pablo] 27/11/2018 11:24

Cheers, JC

[jc2706] 27/11/2018 11:16

Because it is not a hard and fast rule despite what some may think. For investment vehicles it is a rule that they have to do a deal within a certain time frame or else be delisted. It is not clear cut with RTOs and I suspect comes down to a process of negotiation.

[2pablo] 27/11/2018 10:53

We would have to re-list somewhere when we're ready. It would be costly though and involve a completely new application to an exchange. I'm just wondering how we've managed to surpass normal regulations with regards 6-month maximum suspension.

sparky, no need to worry about it yet though. Where's the money Artem?

[sparkyboy1] 27/11/2018 09:49

Pablo what would happen if we did get chucked out of AIM ????? what happens then

[2pablo] 27/11/2018 09:35

How come we've managed to stall on getting chucked off Aim? 6 months is one's maximum suspension and we've dragged it out to over 7 months now with no end in sight

[jc2706] 27/11/2018 09:13

We will never know! I agree that the area we are dealing with here requires a certain amount of scepticism but this is something that can infect one's whole view of things. So we wait to see what actually comes of Kapan et al. I am fully expecting another M&A titbit in the next few months. Do a second deal and I suspect that it is game on.

[casual47] 26/11/2018 12:27

But I don't quite believe that Kapan alone was for sale at $75m and chaarat haggled them down to $50m+$5m loan note.

[casual47] 26/11/2018 12:25

An alternative scenario to the one I gave above:

POLY may have started insisting on selling the whole Armenian business as they wanted to get out of the country and quoted $75m. Chaarat may then have managed to convince them to start with Kapan.

[casual47] 26/11/2018 12:19

JC, I think investing in Russian sphere assets may have given me a Russian sense of humour....and outlook.

I also think $50m is a good deal for Kapan. I have been a little sceptical about the reducing sale price down from $75m also -- I think the original plan may have been for Chaarat to buy the whole Armenian assets off POLY, because it doesn't make much sense to leave Lichkvaz out of it, as it is completely dependend on Kapan, as all its ore gets trucked to Kapan for processing, as far as I know. So I think the $75m was for the whole Armenian business and the lack of stampede for the "up to $100m" loan notes may have forced Chaarat to come to a different agreement with POLY and do just Kapan with optionality to acquire Lichkvaz later on. (The whole exclusivity thing is a red herring: Who would want to buy Lichkvaz as a standalone?)

[jc2706] 26/11/2018 12:11

I think that people are becoming a little too sceptical here. These things take time so give it a bit to see how it pans out. I am pretty confident that it will and, given the penalties, it is in each party's interests to do their bit. You don't tend to get companies committing to such penalties unless they are very confident of the deal advancing.

As for the comedy sketch casual47, I think that it is more reasonable to focus on the fact that the deal is lower than we at least thought that it would be, even if the figures we had were not accurate. The sums involved seem like a reasonable price for the asset.

[casual47] 26/11/2018 11:23

Pabs, the total penalty would be $10m as they are keeping the $5m deposit and the $5m loan notes they will be given.

I can't help but be sceptical and think it was quite a bit of spin for Chaarat to sell the $5m loan notes for POLY as "POLYMETAL IS PARTICIPATING IN THE LOAN NOTES OFFERING SHOWING CONFIDENCE IN WHAT WE DO AS THEY ARE HAPPY TO TAKE OUR PAPER"

Here is a little comedy sketch which 100% never happened:

=======================
POLY: OK, please pay us $50m for KAPAN
Chaarat: How about we pay you $50m and then also give you this nice paper certificate we have?
POLY: What? Er, OK....sure.

Chaarat to press: POLY IS INVESTING IN THE FUTURE OF CHAARAT!!!!! EVERYONE BUY OUR LOAN NOTES!!!!

POLY:......
========================

[2pablo] 26/11/2018 06:49

Sparky, might take till February but I doubt it. Also, I note in 2nd para of 30 Oct Rns, we're going to lose $5m if we don't complete (Ahhh!) :

The SPA is conditional on (amongst other things): (i) Shareholder Approval; (ii) approval by the State Commission for the Protection of Economic Competition of the Republic of Armenia; and (iii) the Company obtaining financing in relation to the Acquisition (the "Financing"). These conditions are to be satisfied as soon as reasonably practicable and in any case by 15 February 2019.



If the SPA is terminated (i) because CGIL fails to satisfy its conditions (including Shareholder Approval and the Financing) or fails to comply with its completion obligations, Polymetal will retain the Deposit and CGIL must pay an additional US$5,000,000 (or the Company issues Convertible Notes for that amount to Polymetal) by way of additional termination fee, (ii) because Polymetal fails to satisfy its conditions or completion obligations, Polymetal must repay the Deposit and pay US$5,000,000 to CGIL by way of termination fee, (iii) for any other reason, Polymetal must repay the Deposit to CGIL and no further amounts are payable.

[sparkyboy1] 25/11/2018 22:23

When is the deal for kapan going to be finalised and us getting back on AIM it don't look like it's going to be this year

[casual47] 25/11/2018 21:28

For those still interested in the Kumtor saga:

[rhuvaal2] 23/11/2018 16:28

richgit used to post here frequently, led me in so to speak: also gather he was Q heavy into OMI ~ trust he's alright. Good luck if you're reading.

[jc2706] 23/11/2018 11:25

All worthwhile exploring so don't dial down completely. The region tends to put low valuations on properties but from my perspective that can be an opportunity. If you can get it right in this region then you can generate plenty of profits in relation to market cap. At some point I expect gold to take off and at that point the company would be throwing off cash => dividend => either a big fat yield or a share price re-rate to reflect the dividend, irrespective of the region.

[casual47] 23/11/2018 10:44

JC -- I take your point, but there are still some issues that make this for a slightly uncomfortable wait:

1. The Russia/CIS/Kyrgyzstan discount factor which puts off a lot of investors (which is why Barrick etc pulled out of this region a long time ago) -- I knew about this when I first invested, well before Anderson got involved, so I'm fine with this, but it is clearly an issue and the reason why there are so many stalled projects in this region.

2. The sudden reduction in loan notes from $100m to $50m. They put a "good news" spin on it but I am sceptical, or rather.....I don't believe it at all.

3. The issue they had filling the remaining $5m of the $20m loan notes earlier on.

4. I accept Artem was a significant player in his Rusal/EN+ days, but what has he actually achieved of note when not working for a huge company like EN+, for which you can assume some doors will open more readily anyway?

All this is of course moot as we are suspended and I don't want to get all gloomy about it so I'll dial down on this aspect of things, for the time being.

[jc2706] 23/11/2018 10:09

Casual47,

In regards to the backers never materialising for the POG takeover, I wouldn't look too harshly on this. Artem Volynets is a chancer and his mo is to go in all guns blazing. If he could cut a deal that made sense do you not think that financing would have been arranged on the back of it? This is a not uncommon practice - do the deal and then take it to financiers to pay for it. I have seen deals never materialise when they have tried to line up finance ahead of the agreement.

I don't have any problem with this even if the process tends to be associated with rather dubious characters!

[casual47] 23/11/2018 09:07

Looks like they forgot to update the Tulkubash timeline in the new presentation (still has the reserve report due early November)

Tulkubash project development timeline:
• Updated reserve report due to be published in early November 2018
• Updated Feasibility Study in early 2019
• Project Finance expected to be agreed early 2019
• Targeted commercial production 2020

[casual47] 23/11/2018 08:55

Local news on what was discussed during the PM-centerra meeting. Looks like all will be solved with a few extra bungs here and there.....

"According to the press service of the government, one of the topics of discussion was a strategic agreement between Kyrgyzstan and Centerroy. The Kyrgyz side offers additional conditions providing for an increase in environmental payments and the formation of a social partnership fund for regional development."

[juju44] 22/11/2018 21:49

Casual those issues are there but Anderson is a good guy and has put this team together and splashed out a lot of his own money . Artem has a history but the pedigree generally is top notch . I don't mind about the Russian backers . This game is full of crooks including the US govt and leading world bankers so why worry

[2pablo] 22/11/2018 20:54

Casual, yep it's put up or shut up time for Artem

[casual47] 22/11/2018 20:50

Juju, you're not worried about the "characterful" Russian biz backgrounds of both our Chairman and CEO?

Also e.g. Artem's involvement with the failed attempt at taking control of POG, where concrete info on where exactly the money would have come from never materialised?