People are just being silly NOW .., page-14

hi All

-so looking at this attempting with a balanced view;
global metal demand; currently demand exceeds supply and this is expected to blow out further right up to 2035 according to ASM recent investor presentation.
-metal prices are rising; most up 10% or more this year.
- demand for magnetic metals such as neodyium have high demand from everything from Electric vehicles, to wind turbine generation and turbine replacement

Issues with the agreement driving significant uncertainty;

-initially asm announced a 250 million usd investment by the korean consortium for 20% of dubbo- this is now completely off the table. A much smaller 15 million USD amount is all that's been received with a non exclusive agreement to find a different buyer for 10% of dubbo for 125 million usd (about 180 million aud)- this is half the amount originally agreed to. further a 50 million usd investment for 30% of the korean metal plant values this metal plant and all future revenues at about 165 million USD. if the KoreN metal plant is going to generate 280 million annual revenue and 40 million usd free cash flow each year, something doesn't seem right here; the 50 million for 30% sounds far too cheap. in 5 years this 50 million would yield 5*0.30x40= 60 million usd profits, or 48 million in 4 years. this suggests a 25% return on investment give or take for 4 years and then the korean metal plant would continue making 25% return as long as its running. this doesn't sound like good bargaining by ASM management

the 10,000 offtake has gone from exclusive to non exclusive to halving in size and still not confirmed
- i can't see any updates on this point; how has ASM management gone from 10,000 to half this amount and non- exclusive without much of an explanation. i feel the mgmt should address this rapidly changing and falling commitment by their korean consortium. if the demand is there and prices are rising for the metals, why have we gone from exclusive offtake to non exclusive to half th amount
- i think the Aus Govt commitment was based on exclusive offtake agreements wasnt it? if ASM mgmt cannot lock in exclusive agreements for offtake isnt the aud govt funding dead in the water? mgmt should update holders on this

125 million usd for 10% of dubbo by an investor
- with a current market cap of 500 million any investor could attempt to acquire a 10% stake in ASM for 50 million AUD (35million USD). a 125 million USD (180aud) for 10% of dubbo sounds very steep at current share price. thinking out loud what investor would go for this kind of deal, when they could spend thhe same amount and acquire much more than 10% of ASM as a whole (not just dubbo) for this much or less?


it would be good for ASM management to update the market on these risks . if they are apparent to me then they need to be addressed by mgmt and how they are addressing these risks

thoughts?the falling share price puts the 125 million usd for 10% of dubbo at very high risk imho based on the above why would they do this when they can buy 10% of asm for less than half this amount at current shareprice

the 50 million i think is very much going to happen. getting a 25% return and payback within 4-5 years is a very good investment. and it doesn't hinge on asm going ahead with dubbo just the metal plant which is already built

i think in the current environment worse case scenario is right now we have zero secured funding for dubbo now; the aus govt investment was based on securing offtake i believe and securing an investment partner ; both of which haven't happened. the metals business looks sound; but now ASM will only own 70% of this; or a free cash flow of 28 million usd/year(35 million aud). what's the P/e ratio on a business generating 35 million aud a year (20x would be a market cap of 700 million)

i only recently bought back in. let's see if mgmt can update on what's happening with both the Aus govt loan , offtakes and this strategic investor.

i cannot see any investor forking out 180 million usd for 10% of a mine not yet built when at current shareprice they can get more then 10% of asm for less than 50 million aud; this would imply they could buy a 30-40% of Asm for the 180 million; a much better deal for the strategic investor

thoughts?