Ann: Sale of Mt Marion equity for A$104M and retention of Offtake, page-41

Hi Mongoose, I very much doubt your prediction 2019 will materialise, for what it’s worth here are mine.

Nmt will have some $130m or more after sale goes through, Lioh plant cost about $200m from memory so if they match fund to build, that’s $100m spend, but they would then own the plant 100% should they borrow $100m and go it alone, they may bring in partner to help fund/run the plant, reduce cost to NMT and risk if they do.

Open up DSO operation cost $10m, they Ann deal with offtake partner early 2019 then crack on and produce new revenue stream from it towards end 2019. Once they have offtake partner signed up and cash from sale in bank they then Ann divi, say 1 or 2cts, 2cts cost $11m, they need the cash to fund projects so thoughts are an “affordable” divi gets paid no more than 2cts. 

They finalise battery reprocessing studies and build first plant, cost $6.5m. 

Cash burn on overheads etc $8m 

Add all that up and it’s roughly $136m should they do it all with no cash from any partners and borrow $100m to match fund Lioh plant.

They may get partner for some or all  these three projects to help fund and or inject  cash upfront to buy in which gives a lift prior to income coming on stream and conserves cash for other projects and opportunities, like the did with MM only this time hold a much larger share. 

Once these are up and running the income should be far in excess of anything generated by holding our stake in MM long term and the share price will reflect our new revenue stream. 

That’s my glass half full prediction for 2019 with the first one to fly being the DSO operation signed up with offtake partners replacing revenue sold at MM.

If you have no trust in the management to drive value for shareholders then sell and move on, I think this sale value of MM asset to be less than I’d have liked but is great for NMT, gives them the cash needed to push on with the above and unlock greater value for shareholders, and peruse other opportunities management are working on we don’t yet know about. This cash is a game changer for NMT allows them to accelerate projects in 2019, looking strong going forward, very happy long term holder,  Merry Christmas and here’s to a prosperous New Year whatever you decide, Loop.