LESSONS TO LEARN FROM CHINESE TAKEOVER OF
TIE THIS WEEK:
The Chinese just stole
TIE & it was directly the result of the CEO inaction when shareprice was under pressure...
I'll tell you all this story as it's a big reason i go on & on about buybacks being so important when the shareprice is greatly undervalued like KCN was in 2023 and still is today...
- TIE being a new mine failed to achieve what they promised at the startup and the shareprice suffered, but they were still making great cashflow and the bank balance was increasing nicely each month but the shareprice was hit hard down to 30c from 85c
The CEO, who I've praised as being an excellent Engineer who built the mine failed to Act. He may have been a good builder and he built the F1 racecar, but he could not drive it, so the Chinese have stolen it from his hands..
The CEO had plenty of cash just to start nibbling at a small buyback at 30c, 40c, 50c to stabilize the shareprice and he sat on his hands and did nothing...
Whilst he sat on his hands congratulating himself that things were improving & production was improving & cashflow was improving & debt was almost paid off, THE CHINESE WERE BUYING THE CHEAP SHARES !!
Whilst he was patting himself on the back , THE CHINESE WERE BUYING CHEAP SHARES !!
So they bought everything he didn't at 30c, 40c, 50c then launch a takeover at 58c whist the CEO was patting himself on the back for all the operational improvements.
So the back balance continues to improve and i was listening in to a conference call just last week after they announced record Gold production how everything was great and listening to the CEO say how they were sitting on a big cash balance +$50 million and he didn't know if they should pay a dividend or look for a new mine !! ---- I was punching the walls listening to this !
Whilst he was patting himself on the back, THE CHINESE WERE BUYING the shares he could have been buying back and reducing dilution himself..
He let it happen..
The Chinese then last week Stole TIE for 68c after announcing they had accumulated +50% when the lowest valuation was 90c- $1
Why ?
Because the CEO sat on his hands, preferring the look of a solid cash balance instead of buying back shares, reducing dilution & creating shareholder value & stabilizing the shareprice and not allowing the Chinese to buy cheaply when he needed to support the shareprice.
The Golden future was stolen from shareholders because the CEO let it happen.This is what scares me about about our MGMT when they failed to stabilize the shareprice in 2023 with just a little buyback nibbling away each month & instead stuffed $500,000 into there pockets instead of reducing dilution and looking after shareholders first.
MTC
(20min delay)