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Ann: Share Divestment (GL1), page-29

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ANTON707

2,816 Posts.

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16/09/22

06:51

Post #: 63728771
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Originally posted by Countrywriter: ↑

G'day gang.

I see all sides in this and have mixed feelings too. The initial payment was measured at just $33M with upside from the value of the 20%. The value was also "free carried" while avoiding a split in their attention. I think gold is going to do extremely well.

So BRB got $13M up front as $6.5M in cash and $6.5M in GL1 shares. Those shares actually yielded $21.45M not $6.5M. The focus is totally gold so this is all a bonus, Manna from heaven. The company chose to JV the project and avoid further dilution.

The two $10M payments are still in play and GL1 pay to advance the value of the 20% and they are connected / well regarded in the Li space unlike BRB. So BRB has received $27.95M so far in cash and have $20M more in payments to come + they retain the value of the 20% stake which is now circa $75M. If you add this up currently you do not get $55M. You actually get $47.95M + 20% = currently the value of cash received and the 20% is $122.95M and growing. That has been magnificent. BRB pegged this, discovered it as a gold explorer / developer and turned a huge profit while continuing to advance the gold asset.

I am a little frustrated that they sold right now and wish I had been consulted but I am not on staff or management. I would have suggested a part sale based on the technicals of the chart of GL1 but this is still a great deal IMO. Why? I agree a lot was left on the table on this sale. But they have two years of cash burn now and no risk so investors can step up with confidence they are in a great position that is only improving. I think this needs to be put in context and I hope my report will assist with that.

They have saved dilution and capital spend on Manna. Do not discount the work done by GL1 in addition to the cost of drilling and geo's on site to manage the process + additional admin etc. That would have cost BRB a lot and BRB could not spare that.

So BRB have $24M in the bank and $10M coming probably in a few months. Manna could end up being worth $600M or more so $120M to come yet and $10M more on production. I only hope they do not sell the 20% too early and suspect they will not.

Now what about further Li on the BRB ground position that they so skillfully researched and pegged and nursed to discovery? Hmmmmmmmmm.
And what of the rest of the time ahead of us if we stay? Where is BRB going? Remember that most explorers never find a viable deposit and some that do mismanage it and lose it in the end. The story is far from over. I hope they protect and nurse this to fruition for us all.

Cheers, and with respect for all views as always CW
Perhaps I can shift my sentiment to "hold"' now as I have made progress.

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Hi CW I am also wondering about timing of the sale. There must be something from here in management mind which could require that cash sooner rather than later like ramping up exploration including lithium, M&A?, fund 20% in Manna etc. because if they bring the cash towards the end Of FY there could be tax implications on capital gain?

BRB Price at posting: 24.0¢ Sentiment: Buy Disclosure: Held
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0 Great analysis

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