peter, do you want to know why?, page-22

danhold and others

GCL-Poly are acquiring LNCs IP for $120M via the acquisition of shares. If LNCs share price recovers to $4.50 GCL-Poly have effectively paid nil for the IP as they will own shares worth $120M. This has been posted previously so I feel I am wasting my time having to explain this and I apologize to those who have the awareness to understand this.

For the simpletons on this thread, buying stock at current market prices doesn't give you access to the IP so the argument as to why GCL-Poly may pay $4.50 for sub $1 stock is mute. Refer to the CNX deal and you will see the same situation. As for LNC, they get $120M in cash without it being considered income, i.e. no tax to be paid. LNC get access to a top 5 (in terms of UCG potential) market with massive potential and partner with a company that has the funds to make commercial plant(s) in China a reality. Those of you who are not crying over the current share price will be able to see this deal as a win-win. I too understand the deal is yet to be signed so there is still an element of risk. You may wish to remember that on 16-Jan-12 LNC released this as part of a response to a speeding ticket:

"it advises that is engaged in discussions with a potential cornerstone investor in the Company with which it may pursue significant UCG-GTL opportunities in Mainland China."

You may agree that if talks have been ongoing for 5 months and LNC have progressed to this point, then there are only the legal formalities to deal with.


Now if you are still scratching your head, note that GCL Poly not only get the IP but a share of the company which when you look at the assets could be argued to be worth $2.5B. Now I understand that asset valuation is difficult so $2.5B can be considered an arbitrary figure.

For those complaining about the current share price or the company or the CEO, please do yourself a favour and find a more successful UCG company in the world. When you find it, feel free to tell us all about it. Furthermore I will even invest in it. This stock is and has always been about UCG, a technology that can prove worthless or prove to be worth billions. If you can't handle that risk or you don't have faith in UCG you are in the wrong stock.

I have ridden this stock from $0.175 to $5+, back down and I have zero complaints and sufficient faith to continue to hold. UCG is not dead and is very much alive with the LNC/GCL-Poly deal and CNX/Shanxi sanyuan deal being significant deals leading to the likely commercialization in a major market. Furthermore, it shows that Chinese companies are willing to pay millions for Australian companies' technology instead of utilizing the technology derived from the in-country UCG operations.

Phew! What a rant! I apologize in advance.