Solgold Share Discussion Threads

[mirabeau] 27/11/2018 05:13

SolGold Plc

Newcrest Tops Up!

Impact: Mildly Positive

SolGold has announced that Newcrest Mining has exercised its top-up rights, to maintain 13.7% ownership in the company (Figure 1), which follows a strategic investment by BHP and a significant increase in the resource at the company’s flagship Cascabel project. This update aligns with our view that Alpala, within the wider Cascabel project, is a world-class deposit with scale potential that separates it from the pack and is receiving ongoing interest from majors. We highlight that we will be hosting a live webinar with Nick Mather, CEO of SolGold, on Wednesday, November 28th .

Highlights:

Largest predators still lurking. Newcrest Mining, Australia’s largest gold miner and block caving expert (Wafi-Golpu & Cadia East – Figure 2), has increased its stake in SolGold by purchasing an additional 6.71M shares pursuant to its top up rights under its original August 2016 share subscription agreement, which were priced at 37.14p (C$0.63/sh).

Competitive tension, which should provide a takeout premium. With two majors on its share register and others likely lurking in the background, we believe the eventual takeout of SolGold is likely to occur at a premium to historic multiples of 0.75x NAV or US$0.08/lb CuEq (Figure 3). A potential transaction is likely to be similar to the recent acquisition of Nevsun by Zijin Mining, as Timok and Alpala are very similar. That transaction was done at 1.25x NAV, implying a value of C$1.85/sh based on our estimates suggesting 185% from the last close of C$0.65/sh.

An exciting 2019 expected for SolGold. Besides the maiden PEA (expected in Q1/19) for Alpala, we are looking forward to ongoing exploration results, particularly from the northwest portions of the deposit, where early results imply the potential for a 2nd porphyry center.

Valuation:
Newcrest top-up highlights ongoing interest in Alpala. Solgold trades at 0.44x NAV, a slight premium to peers at 0.38x. Given the world class nature of the deposit, and the demonstrated interest of multiple majors, we believe we believe a 0.90x NAV multiple applied to our C$1.47 NAVPS estimate would be appropriate implying a value of C$1.32/share. Upcoming catalysts: 1) Ongoing exploration and 2) Maiden PEA (Q1/19).

end

[lefrene] 26/11/2018 18:56

As always alwaysevolving! talk is easy and cheap, the scribblers get to fill their column inches which is all that matters. I think this so called copper squeeze has been 'imminent' for the past two years at least! The recent price history of copper suggests that the 'squeeze' is a mythical beast. Perhaps as it's getting close to Christmas, someone could put on a show for NM, with the usual shouting out of "It's BEHIND you!", "the copper beast is BEHIND you", but of course NM never does see it until just after he's sold the farm. :¬)

[alwaysevolving] 26/11/2018 17:09

Trouble with that Lefrene is we could be waiting rather a long time?!

[mknight] 26/11/2018 16:06

How many biĺlions in gold

85 million x 1224

[lefrene] 26/11/2018 15:40

I feel that it needs copper to start fulfilling the hype, if it happens the herd will soon focus on who holds large amounts of copper.

[5070481] 26/11/2018 15:30

WOuld have to disagree. LOok at teh MRE when it was released last year. Great repsonse initially and then a drip down. Needs the next stimulus. INvestors have only ever seemingly been interested in short term drivers with SOLG raather than the long term picture.

[mknight] 26/11/2018 14:06

The copper and gold are still in the ground so nothing has changed . Lets see what NM has to say this week .

[mam fach] 26/11/2018 13:38

There was a time share price would be flying by now
with all the news we've had.
How times have changed.

[arcadian] 26/11/2018 11:29

If the book is being manipulated to hold the present share price down as Mira suggests, I think we should be flattered and optimistic, confident that NM will not allow their short term tactics to disguise the true value here or deprive shareholders of their rewards.

[5070481] 26/11/2018 11:07

You can indeed. WHich is much better than the terrying ride that the oilers have been on!!!

[onedayrodders] 26/11/2018 10:34

You could put a slide on that chart from mid October and have a very smooth ride down.

Personally smacks of market sentiment and the majority going to cash

[mam fach] 26/11/2018 09:33

Is this another buying opportunity ?
How many do people need ?
If majors are keeping up with their options what does that tell you.

[mam fach] 26/11/2018 08:55

Don't think so.
Do we think share price has been held back ?
Do we think we know why ?
Only thinking out aloud,
Hold on to your shares!

[telbap] 26/11/2018 08:12

Are we suspended?

[mknight] 26/11/2018 07:20

Newcrest upping its shares. Wonder if it was their iceberg .

[mam fach] 25/11/2018 22:29

Not only are rhe wagons circling but we are waving a white flag!

[lefrene] 25/11/2018 20:56

I should think that Nick has his ear to the ground, he will have a good idea as to where the industry is trying to place itself. It would seem that the big boys are moving to circle their wagons in anticipation of action a bit further ahead. All we have to do is sit and see how it pans out, hopefully bigger outfits have more capital raising power, and thus have more capacity to own the best plums. Now all we need is for those copper prices to start to rise, which so far is noticeably a non-event.

[mam fach] 25/11/2018 20:38

Wonder what will happen next week.
Exciting times that's for sure.

[mirabeau] 25/11/2018 18:29

Decks being cleared prior to a merger or possible takeover?

[mirabeau] 25/11/2018 17:54

Newcrest, very interesting stuff

Today 17:53

Street Talk -Nov 26 2018 at 12:15 AM

Newcrest Mining: gold plated mega deal predator or prey?

by Sarah Thompson Anthony Macdonald

There is plenty of takeover glitter about Australia's $16.5 billion Newcrest Mining – and the question now is whether it is indeed gold.

Street Talk understands the miner's operatives have been busily travelling back and forth between their Melbourne base and the home of its biggest listed peers, North America, in recent months, considering the merits of various options including leading industry consolidation.

The most logical is a scrip-based merger, which could add Newcrest's strong presence in Australia and the Pacific, with a big offshore miner's footprint in other parts of the world.

And in terms of the most likely dance partner, fingers are pointing at Vancouver-based giant Goldcorp, which has mines in Canada and Central and South America. If geographical diversification is the goal, then it is hard to find a neater fit.

Putting the two together would create a company with about $6.5 billion revenue and $3 billion earnings in the 2020 financial year, pre synergies, leaping it ahead of the likes of heavyweights Newmont and Barrick Gold. It would be a significant step for what is a highly fragmented industry globally, and a deal of international significance.

The lingering question for Newcrest shareholders, though, is whether the company is predator or prey. Merger of equal type deals are all well and good in theory, but history shows there is a better chance of a deal completing if one company gets out its chequebook. A control premium makes all the "soft" issues – such as which of the two parties gets the chairman and CEO's seats – pretty quickly go away.

Sources reckon Newcrest would prefer to take the merger of equals approach, at least initially. But if push comes to shove, one wonders whether the board, chaired for now by Peter Hay, has the stomach to make a big move.

If Goldcorp is the desired merger party, then the ball looks to have moved firmly into Newcrest's court. While both companies' shares are heavily linked to the gold price, Goldcorp has been punished recently for a soft quarterly operating result, while Newcrest has held up reasonably in the recent market rout.

The other thing Newcrest would have to keep an eye on is the political environment, both in Australia and offshore. It is no secret Australia's politicians have an eye on next year's election and are risk-averse to certain types of deals, as seen at APA Group in recent weeks, while Australian miners have been spurned in Canada in the past.

end

[jerryspaniel] 25/11/2018 13:04

Anyone else going to Mines & Money tomorrow?

[zeusfurla] 24/11/2018 17:00

mknight I think that Nick is 63 so is doing well to look in his 50s! Given the drilling not included in MRE2 it is possible to gain 10-20% additional tonnage just from start November to early 2019. I'd expect some rigs to start moving to other targets in Q1 next year although I haven't seen this stated anywhere. It's in Nick's interest to get some assays from other priority sites and make the results public in H1 next year I'd say. He is not hanging about.

[mknight] 24/11/2018 15:24

Anybody on the BB know if what i have stated is true. I base it on his comments that they have 20 percent left. With the rigs they have now i am giessing 3 months . This is positive as news of another find can only push the price up further. It will also imho bring a sale that much closer with loads of money to pish the other projects forward. After all he is not getting any younger must be well into his 50,s .

[lefrene] 24/11/2018 14:50

mknight, the only thing I do know is that Nick Mather will be going flat out to fully prove up Alpala to jorc standard. I'm sure he will make the most efficient use of the rigs he has available, whatever time it takes.

[mam fach] 24/11/2018 13:55

To the non believers this is like a fairy story.