Solgold Share Discussion Threads

[mknight] 14/9/2020 16:26

Going back up maybe some more new tomorrow ..

[huncher] 14/9/2020 16:15

Agree but I am balls in already.

[husbod] 14/9/2020 16:11

Today is a good example of how illogical the market can be. News like we had this morning should have meant we were blue all day but at least going red has meant I couldn't resist a modest top up.

[maccamcd] 14/9/2020 15:39

update from Hannam & Partners.. £1.09p

SolGold (“SOLG”) has announced the completion of a royalty financing
agreement with Franco-Nevada Corp (“FN”), first disclosed on 11th May. FN
will receive a 1% net smelter return (“NSR”) royalty on the Cascabel license,
where SOLG’s flagship Alpala project is located, in exchange for US$100m in
funding, with an option at SOLG’s discretion to increase to US$150m for a 1.5%
royalty. Approximately US$15m will be used to repay a bridge loan advanced to
SOLG upon signing in May. The remainder should be enough for SolGold to
complete the Alpala PFS and DFS, bringing the project to a final construction
decision, whilst also leaving adequate capacity for other, potentially cheaper
funding sources. Repayment of the bridge also eliminates potential dilution
due to ~12.2m warrants which would have been issued to FN if SOLG had
elected to extend the loan term. While the de-risking of the project implied by
today’s announcement is clearly positive, we had already factored this funding
into our model and hence see no impact on our SOTP of 109 GBp/share.

[lefrene] 14/9/2020 15:18

LT, of course both those parties will howl because they see their chances of a 'steal' reducing.

Now the FNV loan is sealed, will we see some good news of drill results in other places start to appear. There must be quite a few CGP holders who might soon prefer to take Solg shares than see CGP face the prospect of raising circa $300 million to stay in the game? Only of course with more good drill results, the Solg offer would be a tad reduced.

[mknight] 14/9/2020 15:12

Good point Lowtrawler

[lowtrawler] 14/9/2020 15:04

LF, a key strand of the Newcrest / CGP argument is what a bad deal FNV was. If they were ever going to keep the price down, today would be when they do it.

[mknight] 14/9/2020 15:02

I think it be that many sell to get into
GGP which seems to go up everyday . I understand that but know we will have our day .

Agree with you 60p not out of the way .

[lefrene] 14/9/2020 15:00

Gold up, copper up, Solg? answers on a postcard please.

[lowtrawler] 14/9/2020 14:51

Mk, I never invest requiring a bid for a return. I'll be perfectly happy if we take this all the way to production.In terms of my earlier discussion. I have often expressed a view that SOLG won't be able to support a price of much more than 40p until they get further advanced. I am now of the view that they have advanced sufficiently to support 60p. Indeed, I think it's essential they get to around 60p for finance negotiations.I suspect Newcrest and CGP are helping to keep the price artificially low at the moment. Once the requisitioned meeting is out of the way, our price should fly.

[rougepierre] 14/9/2020 14:38

I found your discussion most helpful Low...keep it up...

[mknight] 14/9/2020 14:38

Gold silver and copper all up . Finance sorted ..

Solgold down .

Lowtrawler, what does it matter of no one bids for us . The drill are running and sometime soon we might get another Alpala .

[lowtrawler] 14/9/2020 14:28

Whatever our thoughts are on the likelihood SOLG take this to production, we must always work on this assumption. Anything else invites a low bid and, if there is no bid, we are left high and dry.

[mknight] 14/9/2020 14:18

Got 26.35 as well

Now for 26.30 ..

Market cap 540 million

And the 26.30

Lets try 26.10

[arcadian] 14/9/2020 14:17

The question is whether long term financing will be needed. I suspect that NM doesn`t think so despite his altruism and the bravado of wanting to get to production .

[lowtrawler] 14/9/2020 14:14

Arcadian, I agree with you. The addition of FNV as a partner is far more important than anything else.

[lowtrawler] 14/9/2020 14:12

They'd be daft not to given our current equity price. To try and spell things out:When long term financing is being finalised, unless our share price has risen to 60p or more, streaming and debt finance will be used in preference to equity OR the streaming and debt finance deals available to us will be less competitive than the current FNV deal.It is a strong indication that our current share price needs to move up fast before the long term financing is put in place.

[arcadian] 14/9/2020 14:08

Low
I can see your point but for me at this critical point in time as BHP are approaching freedom the seal of approval from a company like FNV says more than equity financing which often leaves a bad taste.

Today`s RNS is a beacon to all those interested parties that a major knowledgeable player values what we have and wants us to get mining.

[mknight] 14/9/2020 14:05

Nothing to stop solgold taking another half a percent or 50 million .

I have another order in 25k at 26.35 and 26.30 .

Sooner or later we will be 40p plus just need to wait .

[lowtrawler] 14/9/2020 13:48

Arcadian. Once again, I am not proposing a valuation for SOLG. The discussion suggests an equity price at which equity pricing and NSR financing are equally attractive. If NSR financing remains more attractive than equity, we will be diluted and NSR financing may also be priced less competitively. We need the equity price to increase to avoid that eventuality.The implied valuation has nothing to do with NPV, shortage of metals etc. It is simply a comparison between NSR financing and equity financing based on the FNV deal. My suggestion is that if our share price was 60p, we could have raised the $100m through equity as cost effectively as using FNV.

[mknight] 14/9/2020 13:18

Funding sorted so i cannot see why we will not rerate . Got an order in at 26.60 which i will probably get as there are those that seem to want to sell even at these prices . Strange as we are now covered to 2022 .

Drilling results and the PFS to come soon .seems too cheap again .

[greenelf] 14/9/2020 13:09

Lowtrawler, we welcome your views. Thanks.

[arcadian] 14/9/2020 13:04

Low

You do have lots of experience and I am sure that you mean well but this is mining for precious metals, in a world desperate for gold and copper (of which we have tons)and lots of big well financed firm wanting to bolster their assets. We have what they would like to have and In these febrile times value becomes less theoretical and more about rivalry greed and desperation. What happened yesterday does not necessarily carry forward so we must resist non mining valuations like yours ( although as a goad/)prompt to those with mining knowledge it could be a challenge). We need more from those immersed in this with more information and time for those extra drillings which will alter all valuations implied or otherwise.

[lefrene] 14/9/2020 12:59

I much appreciate the standard of argument here today, very informative. Thank you.

[lowtrawler] 14/9/2020 12:11

In terms of what are my areas of expertise. I have created valuation models and performed takeovers based on those models 5 times in my career. Those takeovers have varied in value from £50m - £800m. Thus, I have a firm foundation in corporate valuation. None of these events have been in mining and so I do need mining finance experts to keep me straight. We also need to recognise that none of us has access to any detailed information which would usually back up valuations.