chinese begins multi-billion afghan project, page-10

G'day Andy, I have listed below all of my thoughts on strategic partners.

1. Confidentiality Agreements where signed with 12 parties back in 2008. These companies would not have been plucked out of nowhere, there would have been dsicussions and negotiations taking place well before the confidentiality agreements were signed. These 12 parties, would have also been shortlisted from a much larger list, so there was a level of negotiation and company pitching happening well before the agreements were held, and the 12 parties represent genuinly interested parties.

Provided below are 13 possible parties, that may be included in SDL's 12.

Arcelor Mittal
Posco
Tata Steel
Rio Tinto
Ansteel
Vale
Arab States
Japanese
Local Governments
African Development Bank
UNDF
Industrial & Commercial Bank of China
CEMEC


2. Just about everyone who looks at SDL (from a Shareholder perspective) sees that it has huge potential, despite all its hurdles. From the quality of the resource, to the size of the resource, to the operating margin, to the potential for further resource upgrades, the potential is there and shareholders can see it. So why would Strategic Partners view it any differently, when potentially they have more to gain as a Strategic Partner, then we do as Shareholders.


3. The SDL board has failed at the later stages when trying to secure strategic partners / financing for the project previously. I am confident that the board has learnt from the process and any mistakes made, and they have set out a plan, and are going to take their time to secure strategic partners, on the best terms for SDL shareholder. That is why they have issued confidentiality agreements, that is why they are taking their time, that is why we are not seeing any rushed announcements.


4. Since previous attempts to identify strategic partners, the board not only now understand the process a lot better, they also understand their own resources a lot better. This is going to help them sell the idea, and it is also going to help them get the best terms for their shareholders.


5. Despite the fact that there was a recent resource upgrade, the potential for further resource upgrades are there, and it is projected that the CAPEX is going to be reduced, SDL have not really pushed this information too hard publicly. If SDL where getting desperate to find strategic partners, one would imagine that they would be trying to lift the profile of the project considerably, by pumping up the fact that they now have more resources and that the CAPEX is going to be reduced. The fact that they are not pushing this publicly, makes me believe that they don't need to, because they are confident of securing strategic partners without having too.


6. China needs Iron Ore, China is looking for Cheaper Iron Ore, SDL has cheaper Iron Ore, China's relationship with BHP and RIO is weakening. This all reiforces the demand for Chinese Strategic Partners to get involved with SDL.


7. George Jones, Don Lewis, Geoff Wedlock and Ken Talbot. Take a look at their track record in both mining and dealing with the Chinese. Keep your racehorse in the worst of company and yourself in the best.


8. George Jones has announced that he is going to retire on August 31st. Why retire on August 31st why not yesterday? If the vessel is sinking, why not jump ship as quick as you can. There is no pride to be had going down with a sinking ship. George has always said that he will be with the company until its first shipment of ore, which would be a major mile stone. Due to health reasons he is unable to stay on board for another 3 or so years to acheive that, so he is basing his retirement on the next major milestone, which is the securing of strategic partners.


9. Earlier in the year, Ken Talbot threw another $5 Million into SDL. Ken would no doubt know more then the average shareholder. Some saw it as a sign of SDL running out of money and being unable to secure a strategic partner, whereas I bet that Ken was confident that they had strategic partners lined up, all they needed was some more time to finalise the best deal there shareholders. A lot of people have followed Ken into SDL, but when Ken gave us the biggest tip of all, by reinvesting another $5 million at 8c, how many people made the most of this tip? Sure, you probably bought the $5k worth of shares, but why didnt you buy more? Now all of a sudden, you have missed that boat, and the share price has since risen as high as 18c, more then doubling your money. Stick with Ken now, because he knows what he is doing.


10. Lets have a look at the key dates here. The timeline said mid year for the announcement of strategic partners and the end of year for the announcement of finance. George Jones has announced his retirement at 31st of August (Mid Year??) and the company AGM is held in November (End of Year). This to me reads that an announcement on strategic partners will come before August 31st and the details on finance will come around November.

Well that is pretty much my take on the securing of strategic partners. Most of the stuff is reading between the lines, but at the same time, most of it is simple enough to make sense.