Market Cap

Right Then maths time -

Current shares on issue = 769 mill
After the proposed deal = 1,126 mill

If the proposed deal goes through then by my maths the 357 extra TON shares given to WGX if distributed would give each WGX holder 1.057 TON shares per WGX share held, thus -

Shangdong - 157.2mill or 13.96%
Blackrock - 39.6mill or 3.52%
APAC Resources - 29.6mill or 2.63%
Ruffer LLP - 23.25mill or 2.06%
WGX board & Management - 19.66% or 1.75%
JP Morgan - 19.34mill or 1.72%
GEAR resources - 17.9mill or 1.59%

This totals 27.23% and leaves 207mill TON shares for smaller holders.

Only Shangdong would be notifiable as they are over 5%.

While we wait to see the figures proved by management for value and revenue stream possibilities for the lithium assets I thought it interesting that the insto support was discussed. As insto support is mentioned in the Ann and the email sent out by management to some holders, it is obviously a big milestone for them to undertake. I agree too.

Sommers are no Mugs and although I have a few issues with when they raise funds and also not allowing other funds a chance they are in it to make money full stop. They have lots of experienced staff and Frazier has good followings with large instos such as Blackrock and JP Morgan I believe. PC has also been round the block and raised large sums for resource companies so he to would have tried hard for insto support. I know he did roadshows in Aus but nothing has come of it on the register as we all know. To be fair a spec stock with no revenue with projects in Mozambique would be a very hard sell I am sure. However in argument to this the assets, infrastructure and sector are very strong currently and only look to get stronger IMO going forwards.

So lets say that sommers and TON BOD have tried all avenues with insto involvement and still keep drawing blanks. Why is this we have all been asking recently? Well normally they would require A$100 mill MC and also I would have thought a DFS or BFS. Triton now have a DFS but perhaps instos have also already backed the horse they want in SYR and thus will not go anywhere near TON as neighbours and competitors? Could be. Perhaps they are also very unfamiliar with the opaque graphite market which we all know is very hard to get figures and also not grabbing the headlines such as Cobalt and Lithium. I would think so. Then it is Africa which also adds difficulty to insto support and its got to be said that graphite can be found all over the world too. All we can say is they have not invested for any of the above or other reasons that we don't know to.

Insto support is essential for TON if long term holders want to see decent returns IMO and been a big jigsaw piece missing for years. This stock has been the biggest play thing on the ASX over the years and been up and down like an Essex girls draws! It has given the company crippling dilution with no share price support and distanced many an investor because of the volatility and risk associated with the company.

Roll in the now and new management hell bent on production and again the institutional support is highlighted and worked on from all angles by BOD and sommers. PC for me hasn't put a foot wrong and after meeting him earlier this year I liked his knowledge of the sector and professional manor he is going about things. For the reasons above insto support hasn't happened and then this ann comes out.

I am all for insto support but at what cost? Well with this deal the instos would potentially own approx. 14% of TON but be non notifiable and potentially could dump all the freebee stock they get given. Perhaps lithium assets with potentially near term revenue could change insto opinion and hence they would hold or add to holdings? Not sure but it could certainly would only add to tritons assessability to them.

However I would bet that Peter and sommers have gone through the deal with these institutions and perhaps this deal could bring them to the table finally?? At the very least it will increase tritons awareness in the market and that cant be a bad thing as many still think it went belly up I am sure. I mean if black rock suddenly ended up with near 40 million TON shares and 3.52% of the company worth at 10c A$4mill dollars maybe they would buy on market to add to holdings once they did DD on TON and its company making anns to hopefully follow shortly? I mean if they purchased A$1mill stock they could drive the price up and hold well over A$5mill worth of shares that has only cost A$1mill but supporting their current holding??Who knows but I hazard that's what management would like/guide them to do.

So in summary this could be a huge win for TON but obviously at huge dilution too. The figures for valuation of these lithium assets and as near definitive revenue stream details and dates will also be essential to value this dilution but Insto support is a must going forward and this could certainly be one way to get it with 'out of the box thinking' like this from management?? Perhaps they cant do it any other way in the short term with out revenue streams being earned.

For instance when/if funding news for Ancuabe comes out who is going to drive the share price on TON? Lets think about it? Moms and Dad's - I hazard a guess not? All triton anns have come out with an increase and then sell the news for as long as I can remember. However if Triton give away (incorrect really as they receive lithium assets) 357 million shares of which instos receive 150 mill shares in stock it does have the ability to limit the risk of these instos to increase holdings as they are already well in the money? See what I mean?

Lets say 50 cents target for share price - its what some current share holders break even might be but certainly something that LT holders like me would shake your arm off for. So

50c =
With 769 mill shares = MC of A$384.5 mill
or
With 1,126 mill shares = MC of A$563 mill

With the recent DFS stipulating a NPV of A$390mill on Ancuabe and then add in Nicanda Hill, Balama West and these lithium assets then perhaps 50 cents is still achievable? If not then A$390mill for MC for triton would be 50c for the current shares on issue and it still works out at 35 cents with the heavy dilution to potentially come too which is still considerably higher than where it currently is. One thought I had was if as prior mentioned the lithium asset was drilled and could command a value of $200mill then a MC of A$590 could give a 52cent price with the 1126 mill listed shares? Drilling funds could also come from the option conversations that triton should hopefully get into the money in 2018 on funding and binding off takes. Food for thought but I am starting to think who will buy shares in TON when the next sets of Anns come out? It needs instos but will it get it by doing nothing? Food for thought.

On another point that someone has mentioned regarding flushing out Shangdong. This deal dilutes them to 14% and if they want to regain 23% as they were before the CR and this deals dilution they would need to purchase another 124 million shares for an 11% increase. They have 25 mill at 10 cents options so would need to buy on market for the first time another 100 mill shares to retain the 23% they once commanded. However after March 2018 I believe they could creep another 3% or another circa 34mill shares.

I think for me I am now going into this with both eyes open and will look into the assets value but in reality I am sure this is a done deal to be honest. Generally share votes are never anywhere near fully subscribed and thus if management want this to go ahead which it seems they do by bringing it to the table then it will get passed no matter what you or I think.

Think that's enough from me but certainly worth discussing I am sure.

Just getting a beer ready to watch the ashes in a bit hey Dog? I know its all over but this one could be closer? Gunna watch it myself as its the holidays. GLTAH & DYOR.

Laters,

CM