Chaarat Gold Share Discussion Threads

[oli12] 03/2/2020 07:07

Well there’s an RNS just not the one we wanted. Probs a good thing today as the markets will likely be somewhat volatile.

[casual47] 02/2/2020 18:46

Who knows...perhaps the new VP of Government Relations and Security, Mr. Pilipenko, was sent to Armenia to see if something could be salvaged....it would be the kind of thing I imagine he was hired for........

[casual47] 02/2/2020 18:16

Apparently Lydian are in talks with one potential buyer for the Amulsar mine. I cannot see a sale going ahead without cast iron guarantees from the Armenian government re. protection of the asset and removal of the illegal blockades around the mine.

The EBRD have been lobbying the Armenian government to solve the issue.

See tweet:

If you look at the pic you can see the EBRD VP who also attended the Chaarat Kyrgyz investment forum and was having roundtable talks with Chaarat and Kyrgyz officials. The guy in the middle, on the left, is the boss of the EBRD, president Suma Chakrabarti,

[casual47] 01/2/2020 13:38

Note that the VP of Corporate Development hire I mentioned earlier happened in August 2019, a couple of weeks prior to that announcement - and replacing loan notes could fall under his remit (it is an aspect of Corporate Development). He is an old colleague of the CFO and this role probably has at least a dotted line into the CFO.

From his linkedin 'About' section:
"Sourcing, diligence, negotiation and execution of M&A transactions and structured debt financings"

Imo dyor etc

[casual47] 01/2/2020 13:32

In this context I think the following from the 11/09/2019 funding update RNS makes a lot of sense:

"The Company would like to announce that it has closed the previously announced 2021 Convertible Bond raise to new subscriptions. Following the most recent subscription of US$500,000 in July 2019, and the agreement with Polymetal to exchange USD 10 million of notes for equity, the total value of the 2021 notes in issue is US$19,680,000."

Why would they announce the close of the 2021 bond raise for new subscription unless they

a) no longer needed money via this route (unlikely imo)
b) were unable to raise more money via this route (possible but with interest rates where they are unlikely imo, though I think a possible constraining factor could have been finding the right kind of people for it, who would be supportive of the company and are more long term rather than ones e.g. likely to dump their converted shares or turn out to be inflexible)
c) they knew they were going to replace the 2021 bonds with new e.g. 2023 bonds

[casual47] 01/2/2020 12:57

If I was in charge of Chaarat I would make sure they renegotiate the loan notes before releasing any price-sensitive news this side of Tulku financing.

It would clearly be helpful to see the shareprice above the conversion point of 37p to persuade as many as possible to opt to convert rather than cash out or take up new loan notes.

On the other side of Tulku financing the loan notes will be immaterial but until then the 37p notes could be a drag on shareprice movements. Replacing them with e.g. 45p upward loan notes could allow the shareprice to rerate on q4/resource update more freely and at the same time provide support at the new conversion point.

I think we could see Labro convert their existing 37p loan notes and also take up new loan notes, which together with cash flow from Kapan and the Labro loan facility should provide plenty of cash to pay the loan note holders who wish to cash out.

Imo. this is what could be going on in the background right now and the delay in releasing news perhaps has been to accommodate this process and give time to convince the last remaining stragglers to either convert or replace their loan notes.

Some of the recent buying may have been from loan note holders as they will of course already know about any new price point of the new convertible loan notes and may think there is an easy 10-20% flip to be done...

[casual47] 31/1/2020 16:20

The tax stabilisation agreement, a first for Kyrgyzstan, is a key requirement to get Western investment (not so much a problem for Chinese or Russian money as they have other means to "guarantee" their investment).

I doubt it was agreed just between Chaarat and the Kyrgyz government for the sake of it.

There must have been, imo, significant lobbying by A.N.Other (EBRD?) to get this agreement signed and to do so right before Chaarat needs to finalise funding this quarter.

Imo etc

[casual47] 31/1/2020 16:05

Sarastro, formerly part of the Labro concert party, has been buying.

[oli12] 31/1/2020 15:12

Ah ... In that case maybe not.... well not officially... yet ...

[casual47] 31/1/2020 15:10

Mr A stopped buying in December and has no waiver to allow him to do any further buys.

[oli12] 31/1/2020 14:56

Mr A must be tinkering me thinks - let’s see if an RNS is forthcoming.

[casual47] 31/1/2020 14:30

Still think a strong likely candidate to explain the delayed news (resource update, q4) is some sort of financial arrangement - e.g. loan notes, debt restructuring, Tulkubash financing, ....

[casual47] 31/1/2020 14:12

ATs stepping it up a gear.

Great to see more trades and great to see 39p holding (so far)

[juju44] 31/1/2020 12:01

Flurry of small PI trades . Unusual . Wonder what is causing the excitement

[casual47] 31/1/2020 11:50

Average trade size 4,339 so far.

[jc2706] 31/1/2020 11:46

I confess that I don't buy into the Friday RNS thesis. Well, not ones released during the market hours, after hours ones being a bit on the dubious side. I don't see that there is any bad news to bury as the market at large isn't really that cognisant of CGH anyway. Friday afternoon or Monday morning makes little difference to me.

[casual47] 31/1/2020 10:57

Anything they publish now will barely get the attention it needs. Might as well do it Monday morning.

Please: NO FRIDAY 5pm RNS. It is VERBOTEN.

[jc2706] 31/1/2020 10:55

The month isn't over yet!

[casual47] 31/1/2020 10:17

Looks like no operational news this month, which is disappointing, especially as they did give timely updates for H1 and Q3.

But, 41p has been paid which is a big milestone.

[casual47] 30/1/2020 23:25

Found another newly hired VP:



Vice President Corporate Development & Investor Relations
Chaarat Gold Holdings Limited
Aug 2019 – Present

About
Sourcing, diligence, negotiation and execution of M&A transactions and structured debt financings in corporate, private equity and investment banking roles focused on natural resource and renewable energy sectors. Investor Relations role capacity added since mid 2019.

Looks like an old colleague of the CFO.

[casual47] 30/1/2020 17:19

Well, with the current gold price the EBITDA for Kapan alone should comfortably surpass $25m pa. Using a reasonable EV(Kapan)/EBITDA of 7, taking into account the $34m bank debt, I arrive at a shareprice contribution of about 23p just for the Kapan asset.

Before Kapan was acquired the shareprice was 24p, there have been more shares issued since and more debt secured against the Kyrgyz assets but the gold price is a lot higher and we have the $31.5m JV with Ciftay.

So, just off those basics alone a shareprice in the 40s is quite fair....imo

How any news of e.g. EBRD funding for Tulkubash etc would play out is another matter...

[2pablo] 30/1/2020 17:05

I hate those UT trades. Certainly has been a big increase in volume the last weeks, good stuff.

Hopefully, not 'sell the news' guys going to dump at the first news, good, moderate or bad

[jc2706] 30/1/2020 16:50

Yes, very strange. Small amounts but very little selling. Somewhat misleading UT after hours.

[casual47] 30/1/2020 16:19

41p paid. Not sure what's happening but I like it.