Sirius Minerals Share Discussion Threads

[muckshifter] 30/1/2020 10:31

One thing I forgot to mention in post 46785 above, which was a look at the failings in the earliest stages of the project, was that the talk about the government guarantee
also looked flawed, I was convinced, right from the Defined Feasibility Study, iirc.

I believe the DFS and a few other documents around that time tried to show a separation between the financing of the high risk shafts by stage 1 financing, and the remaining works by stage two debt, which as explained above could not work. The Gov guarantee discussions were clearly identified, iirc, as relying on that same flawed principle, ie. the guarantee was expected to be provided for the lower risk works, but the higher risk works were clearly going to be still going full steam, with the much higher risk of failure that was acknowledged in the DFS, and those shaft works carried the risk of failure which would have stuffed the stage 2 financed work and consequently "called" the government guarantee.

[astjgroom] 29/1/2020 09:10

It's a scam from start to finish all orchestrated by greed. Leeds folk raised £9m to replace Ark Royal in a week in 1942. Just saying.

[kreature] 28/1/2020 13:47

Meanwhile, work continues on the railway tunnel, but not on deep shafting to the rocks that no-one needs? Better edit that one then.

[davidosh] 28/1/2020 13:03

ShareSoc are currently supporting SM shareholders as per this link:
The more shareholders that get together to seek information the more effective it will be. Requesting information, meetings and asking for resolutions at general meetings requires a volume of shareholders working together.

[davethehorse] 28/1/2020 10:21

Last one turn the lights off...

[beeezzz] 27/1/2020 22:12

CF should have been sacked after he withdrew from £500m funding, even then I think he was in collusion with AA...

[kreature] 27/1/2020 19:04

o/t, one for John...

[kreature] 27/1/2020 17:40

"constituent revolt" ?

Surely it's a business, not a charity? If shareholders feel short-changed or hard done by, they can hire a lawyer like everyone else. And if they feel the need to revolt, then they could always check into the nearest zoo. Does that sound a bit harsh? imo

[davethehorse] 27/1/2020 15:46

When will this be suspended on the market?

[muckshifter] 27/1/2020 15:45

Best of luck to all the disappointed shareholders who are trying to take some action through Sharesoc, although I don’t think you’ll get anywhere.

Imo, this project from the start has been demonstrably built on ill founded over confidence and optimism, which failed to achieve what had been promised time after time, but the optimism and confidence were, I think, genuine. Despite the failures, the regular reports and news in RNSs were relentlessly positive with just the odd quick “nod” to the possible consequences of things going wrong. That relentless positivity had to be the case, I believe, in a situation where Sirius sought vast sums, with effectively zero collateral, based on an optimistic view of future costs, resources, income and construction programme, ie. if they had been more realistic and explained the obstacles they faced more clearly, they would have had no chance of getting as far as they did. But the problem always was that in the end they were going to be faced with hard nosed financiers, and their experts, rather than enthusiastic, optimistic, often novice and a little naive, shareholders, if they tried to finance the project on debt.

My earliest understanding of that situation came after a site visit long before construction started, during which I had conversations with one of the contractors who had been involved in preparing one of the original construction budgets, who told me the story of what he had witnessed and learned over more than a year of close involvement with the project. The original negotiators on behalf of Sirius had attempted to bulldoze the parks and other local authorities, on the basis of – Jobs and prosperity for the area, but in the end, those local authorities took Sirius to the cleaners before very narrowly yielding very expensive planning permission. These discussions were late in 2014 after two years of “planning application efforts” which didn’t eventually finally get passed for another year. First serious failure and delay, presented perhaps as a victory? I’ve never read the early RNSs / presentations, but I doubt if it was accepted as a serious error of judgement.

The first “serious errors of judgement” (imo) that happened after I took interest in the project (the project not the shares), were in the original Defined Feasibility Study’s pathetic contingency allowance, which I commented on at the time, and several other statements, iirc. The contingency has since been increased in subtle ways about five fold – a fact which will not have gone unnoticed by the financier community. The DFS also revealed plenty of other anomalies if you read it with a bit of scepticism, iirc. For example, the first stage financing was said to be the whole of the financing for the shafts, but elsewhere in the RNS it made clear that the shafts would take up the majority of the whole construction programme, ie. they would not be finished in time for the 2nd stage financing without some sort of ring fencing to separate the financing of the two work phases. The initial information provided by the stage 2 financing lead group (can’t remember what they called them) made clear that the tentative agreement was based on all construction contracts being “all encompassing lump sum” which I was sure could never be achieved. The simple reasoning behind that belief was, and is, that you would not get an all inclusive lump sum deal on the shafts from any contractor on earth, and although this problem was in theory dealt with by the financing of the shafts in stage 1, even if this funding could be convincingly ring fenced to the satisfaction of the stage 2 financiers, it did not make sense. Ring fencing stage 1 finance for the shafts to in theory protect the stage 2 finance wouldn’t work because if the shafts went badly during the full four years of intended shaft construction the project would not survive and the cash lent for stage 2 could not be repaid. Also in this context, I very much doubt if it would be possible to get contractors in a project like this to accept interface risk, ie. delays in the phase 1 works could have a very detrimental and open ended effect on stage 2 works.

The next serious blunder, imo was the reduction in stage 1 budget based on prices submitted by the preferred contractors at that time, but before the contracts were signed, and even before the completion of site investigation. Can't see the lead bank lending group assembled for stage 2 being impressed by that, and in due course it proved to be a daft decision.

Then there came announcements that the shaft contract had been awarded etc (but with just a few loose ends to tie up) which sure enough turned out to be nonsense, and project delays were denied on the basis that subsequent operations would be faster than originally programmed.

I could go on but there doesn’t seem much point, so I would just say the pattern continued right to the present, and I don’t believe it was a predetermined plan or anything sinister – just a combination of incompetence, over confidence and optimism.

[kenmitch] 26/1/2020 16:00

daffyjones

You’ve misunderstood.The new Sirius shares could be an alternative to the cash offer. There’s nothing extra being charitably given away.

And the warrants suggestion has been used by many Companies and Investment Trusts in the past.

e.g warrants were often issued for free by Investment Trusts as a sweetener to help get new issues away. And some of those warrants ended up multi bagging. There would be nothing, assuming the new Siris shares were tradable to prevent any investor who wants them from buying them. Ditto the warrants which can also be traded just the same as shares.

So the Mail Editor’s suggestion and my warrant idea are both tried and tested. And Mail City Editor probably knows a bit more than some who immediately ridicule the idea here!

Except to respond to questions if there are any, I won’t post again. I was just trying to be helpful! And it’s worth pointing out that it was endless clueless posts here from people with near zero understanding about either Sirius or investing, that helped cause so many locals to lose so much money!

[daffyjones] 26/1/2020 15:48

Kenmitch - why on earth would AA offer such charitable donations to Sirius shareholders? They've already made a bid to shareholders at what they believe is fair value at 5p. That in itself is generous as they could just wait a couple of months and then snap it up out of administration for peanuts. Any AA shareholder would be furious if the company gave away their assets to Sirius shareholders for no reason.

[kenmitch] 26/1/2020 15:17

It’s a terrible shame that so many locals invested far more than they could afford to lose in Sirius. It should have been made much clearer to novice investors that it was a hugely risky undertaking, at huge cost, and with no revenues or profits for many years. But too late to do anything about that now, and imo a class action has near zero chance of succeeding. Shares do go bust, including occasionally FTSE100 shares, and unlucky shareholders end up with nothing.

BUT! All might not be lost with Sirius. Anglo American is a very big multi national FTSE 100 Company. Anglo won’t understand, but need to be told, what a disaster their 5.5p cash bid is for the many locals who invested at far higher prices, and suggestions need to be made to Anglo about what they might be able to do to help those investors eventually recoup some, or even possibly all, of their losses in time.

e.g as suggested by Daily Mail City Editor yesterday, they could issue a special Sirius share. And instead of 5.5p cash, offer current Sirius shareholders to use what is left of their Sirius investment to buy those instead of taking the cash. In time, when it becomes clear that the project will be a success that new Sirius share could do very well. Yes it would mean getting nothing now instead of 5.5p a share, and it will mean waiting a long time to get a much better return, but for any who can say now that they have lost nearly all heir money anyway, in for a penny and in for a pound and give it a go, it is a possible alternative.

Another option, and this could be offered on top by Anglo, could be for Anglo to issue for free, to existing shareholders, warrants giving the right to buy those new Sirius shares, at say, 5p at any time, until long dated (2025 or even longer) expiry date. Then if the new Sirius share is say at 30p those warrants would give the right to buy the shares at 5p and then the investor can immediately sell them at 30p to realise a big 25p a share profit.

The above is NOT All pie in the sky thinking. Warrants used to be very common and huge gains could be made with them when the underlying share did well.

Ideas like these and alternatives that might also be workable make far more sense following up than forlorn hope of class action getting anywhere.

Finally one very good thing is that at least now there is a very high chance the mine will go ahead. Great for the local economy and for the UK too.

And if people don’t like this post at least it’s an attempt to help in contrast to the objectionable posts by the likes of Turvart. Why are people so nasty?

[maxdoom] 26/1/2020 13:58

Sirius Minerals Action List

Thank you to the many people that have already submitted their support for this.
Things have progressed and I am pleased to say ShareSoc have now launched an official campaign here: hxxps://www.sharesoc.org/campaigns/sirius/
If you have already sent your details to the Sirius Minerals Action List over the last week then I have sent you an email with details on how to continue your support.

Shareholders that have not already registered their support can now do so directly from the ShareSoc site hxxps://www.sharesoc.org/campaigns/sirius/

Please do provide your support by registering as either an associate (free) or full member of ShareSoc
Regards

[bbmsionlypostafter] 25/1/2020 15:15

LOL! GLWT.

Looks like a ShareSoc publicity stunt.

[sharesoc] 25/1/2020 14:43

Sirius shareholders join forces with ShareSoc to create united approach to Anglo bid

[kop202] 25/1/2020 10:28

https://mol.im/a/7927219

[amaretto1] 24/1/2020 16:05

NFX... XSG .. PPS.... all tips .. that u would get your money backNFX about to sky rocket .. imo