Australia's largest stock trading and investment forum Australia's #1 stock forum

AVZ

Click for more information

0.00%

78.0¢ avz minerals limited

@setfire2thehiveI’m a critic of management from time to time,...

First 125 Last

Share
Profile

Follow
tendoji

419 Posts.

680

30/06/21

13:27

Post #: 54175368
Share

Originally posted by setfire2thehive: ↑

Post #:53895746

Won't inject too much opinion (maybe 10 paragraphs... lol) as there's a few floating around but I was firmly in the camp of a CR was coming. I was also firmly in the camp that it would be at discount despite vacuous comments from Nigel that it would be done at a premium -> not necessarily a discount to now a 20% discount... Needless to say - as warned.

Post #:53897264
Has some of those opinions, my responses in bold.

Q1 "1. Nige in a March interview stated that any raise would be at a higher price than the SP was at the time, which was 22c-23c.
A) Unfortunately I take very little of what is said by Nige and look more towards what is done. Additionally/Unfortunately he doesn't control the equity markets so what was, is not what is, or what will be done. If people were interested (hypothetically) at 25c then i would have signed that deal in an instant CR at premiums are rare - if they're genuinely available you take them. I give 1% chance they're still willing to pay that and at best maybe you get a similar premium to trading price.

Q2. Nige at recent shareholder Preso's stated that a placement would not necessarily have a discount....as lots of funds around looking to take some action.
A) In essence he went from saying the raise would be at higher price, to not necessarily a discount. The key words 'not necessarily'. Next presentation will be what?"

In terms of the CR will need to see some of the final conditions (escrow and of course who to?) but pretty disappointing as a whole. I say disappointing because I was in the camp of seeing a major equity component for capital done at the same time but evidentially wasn't possible. Just would have been nice to tie that up in one hit. The comments of well now we can get a higher S/P and do the equity component. Well yes, but equally had they met some timelines and already had the news to market perhaps the S/P would be at 16c to begin with. Irrespective, if we look at the CR at hand it's a solid discount. CR's don't required any real genius to grade the interest/quality. If it's at premium or parity, there's interest and it's a good raise. The larger the discount the sheeter it is. In today's market even with these guys doing it 20% for 30M into a 460M stock? Well I'm giving it a 3.5/10.

For context with the new SOI added to retain the same MC of ~460M the S/P will sit at 14.5c. Would expect traded price to start back around that price. Moving forward - you'd think the impending news items move the share price in the right direction and we're soon re-discussing the equity funded component of the capital. Additionally and as i pointed out, the trading was such that it was being positioned for the raise. Whilst lithium stocks around have been flying on the prevailing commodity price this had been controlled for the placement. Once done they (they people it's placed to) will need 300-600M in liquidity to unload the shares on market at prices above 13c. So will expect them to act in their best interest and allow/push the price higher and likely lighten the load into the news announcements.

Irrespectively, and disappointingly it confirms my warranted conservative and sceptic view in terms of what the board says and what they do. After sending some fairly scathing (but warranted) criticisms via email a year or so ago, I fortunately or unfortunately severed what limited comms existed. Which in all honesty is really no concern to me given the running commentary delivered off-market is usually not in line with reality. In my view if you aren't able to give the time to respond to a shareholder with fairly warranted questions/commentary - then it reflects more on them than it does of me.

glass half full, will be that yes, obviously one can pay for the extra equity component and the impending news will wash out the overhang. But with so much really critical components to be delivered, they really need to get their sheet into gear in the next 6months.

I've questioned a few times over the last few years whether NF and the team was the right one to bring this through to production. Like most globally important projects, there is at some point a handing of the gauntlet. AVZ and Manono would look like the Mona Lisa with 1/2 ex-glencore/rio/bhp executives sailing the ship. If the current management team truly care about value creation on their low hurdle rate performance share gifts it would be in their best interests to hand the torch over at some point before production.

Luckily for me still free-carried from 2017 + a few bites at 16c (which I still think this will push into 20's on the impending news and wider lithium sentiment of current), that said, glad to have positioned a larger %'s elsewhere as I really don't have much confidence in the current team.

For those that recall my posting over the last 4 or so years here will know that this is a fairly consistent opinion of mine but not one I feel required to post repeatedly - 20 times a day. 365 days a year like some 'holders' feel required to do. Will post bullish opinions when announcements warrant it.

SF2TH

Expand

@setfire2thehive
I’m a critic of management from time to time, and I agree the low hurdle performance shares are disrespectful to shareholders. And then to not accept with chin in, criticism from fairly or very literate shareholders but to instead turn the table to a question to shareholder’s loyalty etc is worth recalling.
But on the other hand, to denigrate without taking into account the complexity of DFI needs (note, show me another hard rock ASX lithium stock who has done a GHG report), the complexity of working with government organizing and SEZ, and with little precedent, a Feed study, lithium hydroxide study, all these parts and in a CHANGING *emerging* market for products in non-China locations = not vacuous but defeated aspiration on timeline boosting the Share price.
I commented a while back that this will be a test for Nigel with his 19.5cps at time of B&M webinar, and it’s a test that is not quite his to take As this project is not of the same cut as other ASX lithium stocks with more parts than usual for infrastructure and regional development and Newly evolving market opportunities
So Nigel failed to realIse his own ambition on timeline and Share price— if say this stock was in Europe, would funds be easier with an independent GHG report, given that that report is considered materials for Funds? What’s the policy with Australian Funds under current Canberra government laxity?
In any case, why no larger funding right now is simple, no mining license just yet. Again timing can not be controlled by Nigel.
Further it’s known for sometime Nigel intends to take this project himself as MD as far as FID/ commissioning period. From there he may be still be needed in Manono. Once that happens and i expect it happens for example if there is a JV on some capacity with an established miner, then the shift to a management with a track record of productive performance will ease sentiment on managment shifting to more confidence on execution.
Having said that the South Africans on board finance and engineering look fine to me.

AVZ Price at posting: 16.0¢ Sentiment: None Disclosure: Not Held
22 Upvote

4 Great analysis

Reply

Top Stories

PAM

PAM secures high-grade Chilean copper play in strong territory

AZL

Brine and shine: Arizona Lithium wins early stage eco approval to commence wellpad #2 at Prairie

BOE

$550 million Jabiluka uranium offer comes unstuck as Government rules lease won't be renewed

IVZ

Invictus banks US$5M from Zimbabwean investment fund in support of Cabora Bassa

BIO

Biome unveils three year revenue target up to $85M – but are 3Y targets enough to excite?

There are more pages in this discussion • 375 more messages in this thread...

First 125 Last

Add AVZ (ASX) to my watchlist