Ann: Mt Flora Emerging as a Large Mineralised System, page-11

Maybe there doesn’t have to be a single large shareholder selling down a stake. Volumes are rarely very big on a daily basis, so it could be a broker buying and selling the same holding as a way of controlling the price.

Looking at the top 20 shareholders in the annual report, not much has changed except the departure of Harmanis. I suppose a few of them may have trimmed their positions, perhaps losing a bit of patience or just needing to reallocate some capital. But the amounts of shares traded have been chicken feed for most of the large holders, who are pretty aligned with the rest of us in wanting to see the share price move up, at the very least beyond the 16 cents that Harmanis sold out for.

I’m in that group and I’m guessing a few of the long-term shareholders on HC are too. No doubt MDP is top 10 as well, he definitely has the inside track.

So my best guess is that the 500,000-1.5m blocks of shares that pop up suddenly in the trading queue are coming from a broker working for SBM (is Credit Suisse their house broker?). I can’t see any reason why it would have wanted the price to rise ahead of their block purchase to Harmanis, for instance. And during the lead-up to the deal being done the efforts to cap the price seemed pretty blatant. Maybe it was Harmanis steadying the price in advance of the sale, but more likely it was SBM.

After the sale, there was immediately a bid for a relatively large amount of shares about 30% below the Harmanis price too. One poster predicted the price would be steered down to fill that order…. which looked like it happened.

A lower share price also works for SBM in negotiating terms with KIN on the potential production collaboration, by making the alternative route more expensive for the company. And it will be beneficial for SBM if/when KIN announces another capital raise later this year at a subdued price, especially if it’s for a larger raise in which they then swallow up unallocated capacity.

I suppose Delphi and one or two of the other large shareholders might gain from that strategy too but you would think that the main game for them now is to extract as much value as possible from SBM (or someone else) in upcoming M&A. How many of the top ten really have the stomach for a major raise to build a mill, for instance. Maybe a few of them are sitting on solid gains from getting into the stock from 5 cents and upwards. But another 10 cents from here would be pretty welcome, you would think.

All of this is conjecture. And none of it will have much bearing if Cardinia Hill proves to be the bigger find that KIN hopes or in a situation when the next round of results from places like Mount Flora or Eagle-Crow have convinced the market that KIN is going to get to 2m ounces at a much faster pace.

And maybe it’s all completely wrong and KIN announces a tie-up with SBM next month that triggers a re-rate in the share price in its own right. Who knows? But I’m interested to hear what others think…