some serious questions and concerns!, page-3

My comments in bold and all IMO.

blowthewhistle said

I have a few questions and wondering if anyone has any information to guide me in case I am way off the mark.

1) Not sure how many people have noticed but the top 5 holders have changed drammatically in the last 12 months through on going dilution. If a shareholder owns more than 20% of shares, they can potentially start the takeover process (correct me if i am wrong).

Not sure about this but my understanding is that a takeover would need a majority shareholder approval (75%??).

If you check the government website (www.takeovers.gov.au), even though it says that Section 606 prohibits the acquisition of a relevant interest in voting shares, there is an exception if the acquisition results from a rights issue.

I believe this to be correct.

My questions is, why is the management pushing for such a big dilution through rights issue right now when the SP is so low?

It's a mystery and just one reason why the current Directors need changing.

Why not wait until SP is higher or reduce the dilution amount?

Where has all the money that was raised before gone? Can we ask for an itemised view?

You can ask but you want get anything other than the asx announcements, Butnal seems to do OK as well as the Directors associated companies - all of this is in the accounts.

Who came up with 3.7 cents when SP was higher? Its not 10 or 20 million shares, its a huge volume to dilute at such a low price. For me this is one of the points where something doesnt really add up.

It does seem strange and poorly timed.

As mentioned on page 13 of the rights issue, PNG could own more than 25% of the shares. Does it mean that they have to annouce to the market about its intentions to take over?

Maybe but still need shareholder approval.

Are there any restrictions from the Australian govt for a take over by a foreign company? Do they investigate the series of events before the take over offer was made?

Yes there is a maximum shareholding and some govt agency approval required, I don't feel that we have to fear a takeover just the ongoing dwindling of funds and lack of focus on any one lease.

2) I also have concerns about overthrowing the board members. If the push does happen to remove Howard and other people from the board, doesnt it give them the rights to vote for or against the take over since they are no longer in the management?
They already have good amount of voting power - I am not sure how a compulsary take over works in this situation. If you have any information regarding that, i will appreciate if you could share it.

Not sure about this but my understanding is that a takeover would need a majority shareholder approval (75%??). IMO the existing board do not have enough shares to greatly influence a takeover.

3) Lets assume that a take over process is initiated, how will they decide on what to offer when the price is so low right now?
For 3.7 cents CR, even if they offer 6-7 cents it will seem almost 100% jump in the good books of QMN, what about the IGV based on the resource we hold now?
I am sure it is worth 2 digits atleast even with a billion shares. Will there be an independant valuation done if the take over does happen?

If any takeover is offered then the offer is the offer and shareholders either accept it or reject it.

4) How transparent is the QMN management?
Is it possible to ask for details about all expenses and trips made by the management?

You can ask but you want get anything other than the asx announcements.

5) I have seen 'different' timelines given by the management year after year, how far are we really from Production? any production?

The timelines and milestones have been drifting since pre-listing, I can not recall any major milestone as being met.


2012 gold production dates have come and gone. Is it normal for any company to give different timelines and different details during interviews but not deliver?

Many companies face delays on one or more projects and of the companies that I follow QMN have been by far the worst with little in the way of explanation.

If that happens, does it mean we have been mislead by the management?

If I say my opinion I may be moderated, there is sufficient information out there for everybody to make there own mind up.

or is it that it should happen only if the story has been changed for x number of times and only then it qualifies as being mislead? - i am really confused here..


As i said, i could be way off the mark here. Please do let me know what are your thoughts and what to do if any of my assumptions are correct.

The existing/original Directors have presided over huge drops in shareholder value, huge dilution and they themselves and their associated companies have all been well paid, quite simply its time to change the purple circle and give fresh blood a go - IMO it can't get any worse.

Newbie Thomas