$ 37 million placement, page-4

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19/01/21

03:42

Post #: 50260303
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Originally posted by zoulou: ↑

This announcement is out of the blue. For long term holders of TLG, the story has read like the plot from a nordic noir series, with more twists and turns that make the head spin. This is just the most recent episode. So let us keep a level head and consider what has been announced.

Smedvig, TLG's largest shareholder is selling out. So is this a bad thing? It was announced after markets closed in Australia and should be concluded by tomorrow's opening. It might be considered as being in direct competition with the capital raising and the Share Purchase Plan (SPP), except that the capital raising to institutional investors was successfully concluded late last year and the shares issued. The SPP closed on Friday 15 January with results to be announced on Wednesday 20 January. So neither of these transactions are impacted, therefore TLG still has the funding for the Pilot Plant and will raise at least $ 10 million through the SPP for other activities. I say at least $ 10 million as the price at which TLG has been trading recently has been well in excess of $ 1.45 the SPP offer price, suggesting a significant oversubscription is most likely.

I note that the Smedvig sale is being handled by none other than Goldman Sachs, whilst the current capital raising and SPP were being handled by Morgan Stanley, both New York investment banking royalty. How is the sale being conducted? This is book building dutch action where each institution bids for a block of shares at a price of their choice no lower than $ 1.45, rising in increments as announced to the market. Naturally a sale of this magnitude would depress the market if it was dribbled out over a period of time, but for institutions to acquire a significant stake or to increase their stake might require a premium, hence the auction. This means the new floor for TLG is at least $ 1.45 and most likely higher when the outcome of the placement is announced tomorrow. The way this works is that to guarantee full allocation each institution has to bid as high as possible.

I was always a little surprised that Smedvig never participated in any institutional capital raising over the last few years, not even exercising the long dated options it was granted when it became a shareholder, which would have given it a dominant holding. This suggest they have never been conviction investors, but rather early supportive players.

I continue to hold.

This is merely my opinion on the most recent events and does not represent a recommendation of any kind, so please do your own research.

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Great input as always, thank you.

Two US banks book building. Sounds most helpful to me.

Can't see it makes any difference to the compelling business plan of TLG and may signal a wider restructure of the equity and board seats etc.

I agree its a thoughtful disposal of their position, possibly increases liquidity without dilution. I suspect they will pick up a piece of a spin off or be compensated elsewhere in the mix of announcements going forward. Maybe some warrants.

Soon we will know

TLG Price at posting: $1.80 Sentiment: Buy Disclosure: Held
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0 Great analysis

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(20min delay)
Last 48.5¢		Change -0.005(1.02%)		Mkt cap ! $220.6M

Open	High	Low	Value	Volume
49.5¢	49.5¢	47.5¢	$498.4K	1.027M

Buyers (Bids)

No.	Vol.	Price($)
3	64703	48.0¢

Sellers (Offers)

Price($)	Vol.	No.
48.5¢	101570	1

View Market Depth

No.	Vol.	Price($)
3	64703	0.480
1	4400	0.475
5	67996	0.470
3	52139	0.465
2	2900	0.460

Price($)	Vol.	No.
0.485	101570	1
0.490	100	1
0.495	92409	5
0.500	185700	8
0.505	1500	1

Last trade - 16.10pm 22/07/2025 (20 minute delay)

TLG (ASX) Chart

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$ 37 million placement, page-4

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