ceo matthew hogan in the uk, page-42

I agree Bungy, there is obviously a big conflict of interest when the top 20 largely consists of related parties, friends and family. For example there is no way THX would fork out the cash to participate in a SPP given their position and as you mentioned management certainly wouldn’t want to put in more at these prices, after all they can just issue themselves a few more options. Certainly minority shareholders aren’t being looked after and there is little we can do to influence the outcome. Though I don’t see why they would need to raise money at the moment anyway as there isn’t a lot going on so in theory cash burn should be relatively low. I certainly don’t want any related parties, friends of friends or non-supporting investors taking up ‘strategic’ placements at the expense of existing shareholders and as previously mentioned I can’t see how being in the UK is of any benefit to the company. If development of the project into production is the path the company is taking surely the logical thing to do is to approach the Chinese to secure a strong investor that will not sell, potentially provides access to cheap project finance and no doubt provides access to customers to secure offtake agreements.

Interesting to see how everyones ‘sentiment’ disclosure has changed over the last couple of months. More and more people selecting ‘hold’ these days despite the price and a lot of long termers appear to have moved on or lost faith. In the past, such a depressed share price would scream ‘buy buy’. Its obvious that shareholders have lost confidence in the stock (including myself) and for me it is a matter hold and hope for the best as unfortunately I have missed the run up on a lot of other stocks so it seems too risky to sell out now.

At the end of the day UMC could still be a winner and it is likely to be something out of the blue that lifts it higher (such is the management style), but the risks and uncertainty around the company’s direction and progress doesn’t need to be there. UMC may have the best resource out of the juniors but will be heavily discounted if the company doesn’t provide visibility and confidence in the direction they want to take the company. Like anything else on the market the principles of risk and return apply. The risk of investing in UMC is a lot higher than it needs to be with little confidence that returns will be realised.