Agree. I was going to hold back till the merger was done, till I commented on the 20:1 ratio but, it's basically done.
MEP mgmt. have looked after themselves very, VERY well here.
(As I've said before I think the ADN part of the deal is very good. Not Great or good but, very good for MEP holders)
Without going into detail of the wording I was sold something very different to this 20:1 BS.
I thought I'd get 2 maybe 3 cents of value for the spin-off assets.
I'd be lucky to get half a cent now. MEP mgmt. get their MEP options and soon-to-be-released Demetallica options/incentives, (which will likely be exercised by their MEP cash in 2 years.)
Bloody hell mate, you can't expect them to work for free!
*Good work if you can get it. 8-/
Sure, I fully get the spin-off needs to be capitalized but, 9-12M for a transaction they did BEFORE the spin-off?
Why not 3-5M after the IPO?
Now we know why they bought the Sandfire assets back in Aug.
Then there was the Oz deal a few months before which I was curious about.
For years MEP was bragging how great it was that Oz owned most of the JV (They spend all the money in exploration) and that was good for MEP.
Fine, so why is it good that they sold it all back?
OZ know what they are doing. If the land is worth something and you own most of it, why then sell it back?
This 20 year buddy, buddy relationship with OZ concerns me.
I was told that the ADN deal was a good deal. It was.
I was ALSO going to get shares in this spin-off. I can't remember the exact words but, I'm pretty switched on and I was 100% sure I was getting 1x% for 1x%.
Now, looking back at the chat, I remember the wording was a bit more opaque.
MEP mgmt. are very clever chaps.
Now, we walk away with 5% of the 1 for 1? Yet, you can be assured that Demetallica mgmt will be given a whole new set of options and incentives at 1 for 1. Not, 5%.
One of the main reasons MEP had to sell and I think we all felt the same including ADN mgmt was MEP trouble in raising $20-25M to support their funding obligations for GW.
Gee, they didn't have any problem raising funding 10M quick smart for OZ's 80%.
Maybe, they could have did some debt funding and maybe sell off something for 5M "because those MEP copper assets" are so valuable?
In 3-5 years ADN's GW operation will be throwing off massive amounts of cash flow. Will Demetallica be worth the same or will mgmt. STILL be drilling, buying and selling their assets up there?
IMO...MEP mgmt. were planning their retirement the whole time while the merger was happening. Anyone else a bit surprised the see MEP mgmt. FINALLY agree to accept the offer on the very,very last day?
All the while "recommending" all MEP holders do from day 1?
Stepping back MEP mgmt. looked after its shareholders. Did they look after themselves and set themselves up better?
If it walks like a duck...
That's why I'm a bit ticked, MEP mgmt. made money (well not if you've been holding longer than 7 years,) for holders.
They dance on the line of doing everything right but, really just looked after themselves as they screwed up on valuing the GW assets 4 years ago.
ADN will be worth 1B in a year and they got 110M for it all the while they had 100% of it and James was screaming how valuable it was the last 14 years.
They have now bought themselves another 10 years to play in their QLD sandbox until they retire at $500k+ in salary.
The MEP deal looks to be done.
I'm not even sure MEP MGMT. will return calls on MEP. They've probably already unpacked their Demetallica head office furniture. If Demetallica does find something or become successful ex-MEP holders will hardly participate in that success. Unless they sell their ADN shares and load up on Demetallica.
Yes I know, Demetallica assets are incredible, they'll find the big one.
I hope so, because I need that 20 bagger to break even.
I'm willing to bet 5% of the 5% of my Demetallica shares (basically a good pub meal, and I owned a poop load of MEP shares) that Dem will "suddenly" JV 80% of those assets back to OZ in the next 2 years.
Just a rant I needed to get out.
I'll delete this post in a week.
GLTAHs
Long live ADN!!
Expand
