Petropavlovsk Share Discussion Threads

[book5] 14/6/2018 13:53

Citing reports in the Russian press, he says there is a risk 24% shareholder Kenges Rakishev could be acting in the interests of a Chechen oligarch whose efforts two years ago to merge his gold company with Petropavlovsk were rejected by shareholders.

“The serious concern that the board has is that a link exists between Mr Rakishev and the unidentified beneficial owners of CABS and Slevin, and their motive is to acquire control of Petropavlovsk by stealth at a discounted valuation”. Rakishev denies any such links.

[bambo1] 13/6/2018 18:54

Petropavlovsk PLC ("Petropavlovsk" or the "Company", and together with its subsidiaries, the "Group") is pleased to announce a number of strategic and operational developments:



· Negotiations to refinance IRC Limited's facility with the Industrial and Commercial Bank of China ("ICBC") in relation to the US$340 million project finance facility between Kimkano-Sutarsky Mining and Beneficiation Plant LLC ("K&S", a wholly owned subsidiary of IRC) and ICBC (the "ICBC Facility") are at an advanced stage with a major Russian bank.

· The Group has entered into a bridge loan facility agreement (the "Bridge Loan") with IRC in order to help K&S meet the payment due under the ICBC Facility on 20 June 2018 (the "20 June Payment").

· The Bridge Loan is for a Rouble amount equivalent to US$29.75 million at an interest rate of 12% per annum, and is expected to be repaid as soon as the refinancing of the ICBC Facility is completed.

· IRC and Petropavlosk are in the final stages of agreeing a waiver with ICBC in respect of IRC's obligations to comply with certain financial covenants and maintain certain cash deposits with ICBC. If the waiver is obtained and the 20 June Payment is made, the good standing of the ICBC Facility will be maintained.

· The Group has entered into four gold sales agreements with Sberbank for a total volume of 96koz and with an option for advance payment for up to 12 months;

o The sales agreements will provide additional liquidity during a period of planned high cash outflows, the majority of which are associated with POX-related capital expenditure, thus de-risking it.

· The commissioning process at the Malomir flotation plant, a key step in the development of the Company's flagship pressure oxidisation project ("POX"), is under way after being launched on schedule at the beginning of June 2018.

[book5] 13/6/2018 17:17

Galeforce1

the content of the these extracts coincide with you have said in your previous posts

Many thanks

B.

[galeforce1] 13/6/2018 16:24

Book
This is the link I saved, but it doesn't seem to opening.



I highlighted and saved some key paragraphs. See below:

Conversion Right
Unless previously redeemed or purchased and cancelled, each Bond will be convertible, at the option of the holder, into Preference Shares of the Issuer during the Conversion Period and all such Preference Shares shall be exchanged immediately as described below. Each US$1,000 principal amount of a Bond is convertible into one Preference Share having a paid-up value of US$1,000 per Preference Share. The Issuer shall procure that such Preference Share is exchanged immediately, pursuant to the articles of association of the Issuer (the Articles of the Issuer) and the terms of the Deed Poll and as contemplated by the Conditions, for Ordinary Shares credited as fully paid. The number of Ordinary Shares to be issued will be determined by dividing the paid-up value (the Paid-up Value) in respect of the relevant Preference Shares (converted into Sterling at the fixed rate of £1= US$1.5171 (the Fixed Exchange Rate)) issued on conversion of the Bonds by the Exchange Price in effect on the relevant Conversion Date. See Condition 8(a) (“Terms and Conditions of the Bonds – Conversion and Exchange – Conversion Period and Exchange Price”).

Conversion Period
Conversion Rights may be exercised during the period from 28 April 2015 and ending on and including the earliest to occur of:  the close of business on the sixth business day prior to the Final Maturity Date;  if the Bonds shall have been called for redemption by the Issuer before the Final Maturity Date, the close of business on the sixth business day before the date fixed for redemption; or  if a Bondholder has given notice requiring its redemption in accordance with the Conditions, the close of business on the day prior to giving such notice; and  the giving of notice of an Event of Default by the Trustee (the Conversion Period).

Exchange Price £0.0826 per Ordinary Share.

[book5] 13/6/2018 13:27

galeforce1
11 Jun '18 - 16:33 - 47272 of 47282

Galeforce1, you mentioned a "bond prospectus"

Please, could you give the hyperlink to tis prospectus? I have not been able to find any information

Much appreciated

B.

[undervaluedassets] 13/6/2018 10:08

I am loving this.

Big investors/interests are fighting for control of this company.

You do not fight for something unless there is something worth fighting for. They are not doing this for the good of their health.

There is value in abundance here.

And despite recent rise share price still near historically lows.

Long way to go on these. Very happy to hold/accumulate.

[galeforce1] 13/6/2018 07:42

Route - seems to me unlikely. If Rakishev+cabs&Slevin have the votes to oust the current board why should they make an offer, which would have to be at a premium to the current share price?
From the other side, the current board has lost their oligarch. So who would make the bid?
What we might see is quite a lot of selling after the AGM. If the current board is ousted then Sothic and their allies will presumably want to exit.

Somebody suggested that POG could use the cash proceeds from converted bonds to settle the IRC obligations on June 20. That would be very neat.

[route1] 13/6/2018 07:26

Does anyone think that a Bid would be made Before the AGM?

[book5] 12/6/2018 19:28

As a result the company said it would not reappoint Mr Rakishev’s representative Bektas Mukazhanov to the board, saying he was “conflicted221; and that this was “an untenable situation”.

[jswjsw] 12/6/2018 16:33

If you add the biggest blocks (over 2m) you get 34m bought today - for our concert party I wonder? So they now need v roughly 430m more shares to table a bid.
j

[undervaluedassets] 12/6/2018 09:10

Of course not. But do any of us here really have a handle on the JORC resources. I don't. That is why I am comforted by a large shareholder talking about significant values here cos they have done due diligence on those resources.

[inversi0n] 12/6/2018 08:45

Are you saying the russians are merely "private investors"? Most probably these persons behind the scheme are many times bigger than Sothic FUM.

PI may not have 10% holdings, but not all PI are small time investors, a large number could be professional investors.

Just me saying.

[undervaluedassets] 12/6/2018 08:04

I think what caught my attention in the Sothic Capital letter were the words significant value potential.

They are the largest holder and will have done proper due diligence... They will categorically know the value here .. Not just have read half an annual report whilst lounging on the sofa watching the footy in a 2 up 2 down in Cheam (which is the most that private investors ever do.)

[book5] 11/6/2018 17:00

Or take the cash to pay IRC loan instalment to ICBC ($35.16M)
See 24th May IRC announcement

[inversi0n] 11/6/2018 16:37

So some biggies exiting and palming those large holding to the russians I suspect. The price barely moved. I think we should be seeing more of shares transfer.

Sothic Capital is happy with current board? are they OK.


Thanks GF with your calculation,

Obviously he would lose the yield, but will he be risking it though? Take the cash and deleverage?

[galeforce1] 11/6/2018 16:33

My understanding from the bond prospectus is that the bondholders can convert at any time. The price is fixed at 8.26p and the GBP/USD exchange rate is fixed at 1.57. So the USD purchase price is 12.96 cents a share. At current exchange rates this in fact 9.67p.
That's quite alot more than the current share price Also, on coverting you lose the 9% yield you are getting on the bonds.
So from Rakishev's point of view it all depends on how much he think he needs those votes.

[inversi0n] 11/6/2018 16:23

another 9.3m on orderbook again at 8.2p, looks like he's converting

[jswjsw] 11/6/2018 16:16

That's just over £2m worth, so they need about another £40m worth to be forced into an offer ...!

j

[inversi0n] 11/6/2018 15:59

Shares being transferred

4.8m gone at 8.0p

someone took orderbook 9.6m at 8.20p in

then there was a 10.92m trade around 8.1689p

[book5] 11/6/2018 15:55

Today volume is good,approx 1.3% market captain 15:45 hours

[loganair] 11/6/2018 14:42

Stoopid - I do not think so, what I think would happen is the share price being pumped up to say 9p or 10p allowing Rakishev to sell out at a profit, then the share price falling back down again.

[stoopid] 11/6/2018 14:39

Galeforce if Rakishev did convert at 8.2.that would help assist/underpin the share price at 8.2 yes.?Then.they would have to factor in the dilution. I also thought the bonds couldn't be converted unless the settlement date was due??

[jswjsw] 11/6/2018 14:26

gale - Yes, I agree, but the question re the purpose of their stake-building remains.
j

[galeforce1] 11/6/2018 14:16

JSW - I can't see the order book, so I don't know. But I think it's likely that Rakishev will want to convert some of his large bond holdings into shares at some point.

Re CABS and Slevin. My feeling is that these are associates/allies of Rakishev. Probably Russian, but I just can't see why that's a problem. This is a Russia-focused business. There are bound to be Russian shareholders. Are they really so much worse than Sothic, which is a hedge fund, I think.