Metals Exploration Share Discussion Threads

[benson384] 03/9/2010 11:19

Wonder who the buyer is at 13p in market.....? maybe cavalry coming over the hill ? !!

[fjp73] 25/8/2010 19:48

If PI's do as normal, some will tip...I don't blame them...some will not do anything and then get a cash credit if Soloman have enough votes.

I'll sit tight for now, the stock isn't impacted like the other stocks lol...

Have a good evening.

BW Fraser

[holism] 25/8/2010 15:04

Probably right decision.

[chipperfrd] 25/8/2010 15:02

No, I have sold out now I'm afraid.

[holism] 25/8/2010 14:49

chip- will you be keeping your shares and/or applying for new ones if made available? This company will come back to a market at sometime in the future at a much higher price.

[chipperfrd] 25/8/2010 09:59

To reiterate Wendy's earlier comments regarding the complete market over-reaction to the resource changes last November:

If you apply Edison's valuations by category you get a completely different result!

Resource statement 13/10/2008
Measured = 270k @ $339/oz = $91.53m
Indicated = 487k @ $159/oz = $77.43m
Inferred = 1,248k @ $34/oz = $42.43m
Total value (according to Edison) = $211.39m

Resource statement 19/11/2009
Measured = 560k @ $339/oz = $189.8m
Indicated = 290k @ $159/oz = $46.1m
Inferred = 650k @ $34/oz = $22.1m
Total resource value (according to Edison) = $258m !!!

I am not exactly a fan of the Edison methodology - but at least their value weightings emphasise the point.

Trouble is, too many market participants just do not understand the difference between the JORC categories and give equal weighting to inferred and measured - let alone the economic certainty that an established reserve gave.

However, the damage has been done and the market has effectively ruined MTL as an investment proposition.

But good luck to Chris Candy, I really don't blame him for taking advantage of the general market ignorance.
Chip

[agreeable] 25/8/2010 09:56

In fact they dont even technically need 75% to de-list, as a number of other AIM companies have done they get the NOMAD to resign and then don't appoint another one. Stock gets suspended and then never returns.
As an example see NWN

[garrymorrow] 25/8/2010 08:57

Thanks for that, gentlemen.

[wdurham] 25/8/2010 06:51

Fraser -

To delist you need 75% in favour.

But Jon Beardsworth makes the point that even if Solomon don't acquire 75% of the shares, (which would enable them to delist more or less off their own bat), they could simply keep calling EGMs to delist the company until shareholders give in and stop voting against it.

And of course, unlike an offer situation, where every shareholder has the option to "vote" yes or no by accepting or not accepting the Solomon offer, at a GM the 75% majority is of VOTES CAST not shares in issue. So even without 75% of the shares in issue, Solomon would probably secure a 75% share of votes cast at any GM. This is because most PIs don't bother to vote, and many of those that hold via nominee accounts don't believe they CAN vote.

[fjp73] 24/8/2010 21:33

Garry - under AIM rules they only need 51% (approx) to delist as they'd have a controlling interest, which from my understanding, they already have the support of.

I'm in FEP and I don't believe anyone has the full amount to delist the company.

HTH Fraser (HTH- Hope that helps)

[garrymorrow] 24/8/2010 20:49

Something simular happened to Forum Pet. I sold out at a loss. A year later they are still in the AIM, trading at my breakeven. I am tempted to hold! Are they certain to get a 90% holding and will they delist??

[fjp73] 24/8/2010 19:28

Wendy, I totally agreed and with an illiquid stock it paid to trade...I was settling in nicely lol.

BW Fraser

[rcktmn] 24/8/2010 19:20

Had anough, sold out at 12.75p (slight loss) share price will probably double now!

GL All

[wdurham] 24/8/2010 18:32

agreeable -

How wrong you are.

Check out the latest resource statements.

The downgrade last year due to a new understanding of the mineralisation controls derived from further drilling was something that few investors actually understood. However, it barely affected the potential of the deposit to produce a working mine.

Had investors had the nous to understand the reasons behind the downgrade, the share price would not be where it is and the takeover at 13p would not now be happening.

Little to do with management and everything to do with shareholder's lack of technical knowledge.

EDIT - The word "ignorance" seemed a bit harsh and carried connotations I didn't intend, so I have replaced it with "lack of technical knowledge"! 8-)

[agreeable] 24/8/2010 14:29

JB has been a problem here for over 2 years, without Solomon coming in for their 29.9% he had no other support in the market and the company would have had to close down there and then. By accepting the loan he effectively delivered the business without putting up much of a fight. He has since then been happy to take the money every month.
Meanwhile he announced in a very awkward manner the significant downgrade in resource estimates and what was once a cast iron 2 million ounces is down to 760,000 ounces.
JB should return to the army where there are some Taliban miners looking for a leader!
Take the money and run and dont look back

[dougcsv] 24/8/2010 09:20

You've had a negative stance on JB for as long as I can recall - How do you suggest he could have avoided this predicament ? If you read the statement it clearly say he will be leaving under the terms of his contract.

[holism] 24/8/2010 07:27

Yes Beardsworth has been out manoeuvered, I always thought he was an honourable man, but this is yet another example of failure by a banker thinking he has the skills to run a mining company and get rich in the process.I hope he does the decent thing and resigns, or will he stay on and wait for the refloatation in 18 months time?

[trader horne] 23/8/2010 14:12

conclusion from Beardsworth's interesting statement seems to be
"sell out at 13p and move on".

[dougcsv] 23/8/2010 13:48

I suspect you are right - he knows it's a foregone conclusion so it'll make little practical difference, but by not accepting he is making a point and also possibly hoping to avoid the accusation of being complicit in the transaction which would undoubtly come from some people and as has already been discussed on here.
A great shame but one can't avoid the point that if the market (that includes us small investors) thought this was such a no brainer we would've been piling in and the share price would be where we would like to think it ought to be.

The markets allowed Candy to do this and so you can't really blame him I guess.

[fjp73] 22/8/2010 10:05

Morning All,

From the offer document:

Accordingly, I, Jonathan Beardsworth, as the only director deemed independent of the offeror, have taken independent advice from Westhouse Securities on the Offer on behalf of Metals Exploration Shareholders in accordance with Rule 3.1 of the City Code.

I have always believed in the potential value of the Company and its project at Runruno. It is why I joined the Company four years ago, and why I accepted an incentive package earlier this year which would only deliver benefit to me at a share price in excess of 25 pence.

The options issued to me in March this year, at a time when the share price was 13.75 pence, also provide a useful indication of Solomon's value expectations for the Company. The options were instigated and approved by Solomon in order to incentivise management to achieve a share price for the Company well in excess of the exercise price of 25 pence.

In making the Offer at the Offer Price, Solomon is further demonstrating its belief in the value potential to be realised from the Company, and backing that belief to the extent of a potential cash outlay of £20.3 million to acquire the Metals Exploration Shares it does not already own. Solomon would only make that commitment, together with assuming responsibility for the capital expenditure required to bring Runruno into production, if they believed that the returns amply justified the investment.

In practical terms it must be recognised that, starting from a base of 44.10 per cent., with letters of intent in place amounting to approximately a further 9.03 per cent. and with a condition for acceptances of 50 per cent., the Offer is likely to succeed.

The outline sequence of events that has brought us to this situation is as follows:

• Solomon made its initial 29.90 per cent. investment in the Company in January 2009 at a fair market price, and indeed was the only source of potential funds known to the Company at that time. At the same time, Shelfco 725 Limited, a sister company of Solomon, made an £8 million debt facility available to the Company.

• In May 2009, Solomon, evidencing its continued support for and interest in the Company, expressed a wish to increase its investment in the Company, which was subsequently overwhelmingly approved in July 2009 at a general meeting of shareholders with 99.997 per cent. of eligible shareholders (excluding Solomon) who voted approving it. Solomon's resulting interest in the Company was 44.10 per cent. The £8 million debt facility was retired at this time.

• From Solomon's initial investment in January 2009 through much of the rest of the year the share price rose steadily, reaching a peak of 24 pence on 23 October 2009, a threefold increase from the 6 pence share price on 1 January 2009, and seemingly endorsing the confidence of all shareholders in the potential value of the Company.

• In November 2009, the Company announced a downward revision of the resource estimate at Runruno and the share price fell from 22 pence to 10 pence and has traded in the range of 10 pence to 14 pence since that time.

• Since the resource revision the Company has announced positive news in the form of encouraging exploration results outside of the immediate resource area, the award of the ECC, and the delivery of a positive Feasibility Study on the project including, for the first time, the confirmation of 780,000 ounces of gold classified as a mining reserve.

• Despite all of this progress the Company's share price has remained within the range of 10 pence to 14 pence since November last year. This period of poor share price performance, in difficult market and macro-economic conditions, and despite positive news from the Company at a time of record gold prices, provided the opportunity for Solomon to take advantage of its 44.10 per cent. interest in the issued share capital of the Company.

Many loyal and long standing Metals Exploration Shareholders will share with me the conviction that the Offer Price undervalues the potential of our Company.

There are, however, certain practical realities that should be considered by all Metals Exploration Shareholders in deciding their course of action:
• Solomon has received letters of intent to accept the Offer from Metals Exploration Shareholders representing approximately 9.03 per cent. of the issued share capital. When Solomon's existing 44.10 per cent. interest is taken into account, this suggests that Metals Exploration Shareholders can reasonably expect Solomon to have a post-Offer interest in the Company of at least 53.12 per cent.

• Metals Exploration Shareholders should be aware that the Offer will become unconditional if Solomon receives sufficient acceptances to take its shareholding to over 50 per cent. With the letters of intent already received, and starting from an interest of 44.10 per cent., it appears likely that this will be achieved.

• Metals Exploration Shareholders should be further aware that Solomon has stated its intention that, should it achieve sufficient acceptances from Metals Exploration Shareholders and/or acquire sufficient shares to take its shareholding to over 75 per cent. of Metals Exploration Shares, it will procure the cancellation of the admission of Metals Exploration Shares to trading on AIM.

• Even if Solomon does not reach 75 per cent. as a result of this Offer, it is still likely to secure a resulting interest in Metals Exploration greater than 50 per cent., and there will be nothing to prevent Solomon, notwithstanding its current intention, requisitioning a general meeting of the Company at any time with the purpose of cancelling the admission to trading on AIM of Metals Exploration Shares. Such a resolution would require a vote in favour by 75 per cent. of the votes cast by Metals Exploration Shareholders and Solomon would be able to vote its interest at that general meeting. Notwithstanding Solomon's holding being below 75 per cent., the resolution may still be passed, resulting in the Company's admission to trading on AIM being cancelled.

• If the Company's admission to trading on AIM is cancelled, Solomon intends to procure that Metals Exploration will be re-registered as a private limited company under the relevant provisions of the Companies Act 2006.

• If a resolution to cancel the Company's AIM admission is defeated, Solomon would be at liberty to requisition another general meeting at any time, and in the interim would be able, following the expiry of a six month period following the closing of the Offer, if it wished, to acquire further shares in the market at any price in order to increase its interest in the Company.

• If the Company's AIM admission is cancelled and the Company re-registered as a private limited company, Metals Exploration Shareholders will find it difficult to trade their shares, and opportunities for realising their shareholding in the future will be uncertain. Metals Exploration Shareholders may therefore feel that the certainty of the Offer Price is preferable to the uncertainty of a minority shareholding in an unquoted company, even with the possibility of a greater return to shareholders over a longer period.

• The Offer represents an immediate opportunity for Metals Exploration Shareholders to exit for cash, at a premium of 26.83 per cent. to the Closing Price of 10.25 pence per Metals Exploration Share on 22 July 2010 (being the last Business Day prior to the commencement of the Offer Period).

Since Solomon is starting from a position of 44.10 per cent., with letters of intent representing approximately a further 9.03 per cent., and will declare the Offer unconditional once acceptances are received taking it above 50 per cent., it is difficult to see Solomon failing to achieve a holding of at least 53.12 per cent. following the Offer.

Interestingly, I admire Beardsworth's integrity purely because of his statement regarding options! See, there are some decent folk out there!

BW Fraser

[mikey34] 22/8/2010 07:54

Document arrived with JB's comments."I believe it falls short of a price that fully recognises the future potential of the co..........I do not intend to accept the offer in respect of my own shareholding.....However,if the offer becomes unconditional,and in the absence of any revised cicumstances,I will then accept the offer."
So he is acknowledging the obvious....that they're pinching this,that it looks as though we're stuck with it but that he's going to hang on just in case something happens out of left field.I think I will do the same...it looks like this will be the one that got away.What a ------- shame.

[drm4] 19/8/2010 12:50

Thanks for your answers to post 245.

Not been on here for a while but still holding!

Richard

[recommended] 11/8/2010 11:05

benson

Before an offer period you don't need to declare until you are over 3% but in an offer period you not only have to declare your position after the offer is announced (as an opening position) but every trade there after during the offer period. Probably no mistake as he made an "opening disclosure" therefore shares were bought before the offer period.

[benson384] 11/8/2010 10:04

Find it hard to believe two well know property operators don't know each another, guess they met in a casino in Manila etc etc.........
There is no way Edwards could have picked up these shares in one go as any investor has to declare any percentage point..has someone made a mistake ?