GLN (ASX) Ann: Trading Halt

Originally posted by ChasingProfits: ↑

Although I’ve never been a long term holder here, I’ve been closely watching and following the Galan story ever since the early days of Gangfeng taking their initial position. I have opportunistically traded Galan twice and made money both times and hoping to make it third time lucky post the release of this announcement.

This time in Galans journey reminds me of when I took a position in LPI, which was at the time the highest grade brine deposit on the asx, I am pretty certain Galan now holds that mantle and hence why I continue to watch this unfold. Although it was a few years ago the sale of LPI and a completely different lithium market there is definite similarities in terms of pricing disconnect between share price levels and 100% private equity value and that there are/were parties interested in purchasing the deposit at the time which is evidently the case here. I didn’t rate LPI management at the time and neither do I rate JP but sometimes value is too good to pass up. Interestingly at the time LPI share price was also being driven down (at the time I thought artificially for someone to make a take over bid) so they could say they paid a ‘premium’ - oldest trick in the book used by majors buying out companies. I kept buying LPI even with the share price capitulating and long behold I made a great return on investment upon the sale and I am evidently wanting to do the same here.

Good luck to all holders, especially long term suffering shareholders, hopefully JP can pull a rabbit out of a hat here and raises at a premium but even if it is discounted, it’s good to see a definitive agreement being reached. I can appreciate both investors perspectives being given here.

On the premium side of the capital raise, Galan now has a definitive agreement in place which ultimately reduces the risk as $$ are locked in from a revenue perspective and also makes the company/deposit more saleable to a third party on a 100% acquisition basis so could convince shareholders that value has been created and therefore should pay extra to the last closing price (20% perhaps is the most I see to be honest), also can convince investors that they had a offer recently for the deposit greater than current share price as further ammunition to convince investors to pay more. On the other hand discounted capital raise: world markets are in turmoil and heightened uncertainty is present in all investments regardless of how good the company/management are, lithium price is significantly low at the moment and not even majors who have been operating are making profits, there is still execution risk even with definitive agreements in place around getting stage 1 into production on budget and on time, JPs track record regarding use of ATM and dilute at all costs necessary to get to production - capital allocation decisions questionable at best. If I was a betting man I would say it is going to be discounted but I hope I am wrong, it doesn’t bother me either way, if it makes sense and there is money to be made, I will still take a position here. Cheers, CP.

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LPI got sold for A$385 million
https://app.sharelinktechnologies.com/announcement/asx/42d12e0b123de3e1629860d86a341fa1

Their resource was much smaller, they needed a salt removal plant and only had one bidder (government forced nationalization)

GLN is in a much better situation: larger resource, project already half finished, several interested parties

GLN should get at least the same valuation that LPI got, probably better

No.	Vol.	Price($)
2	343549	9.3¢

No.

Vol.

Price($)

343549

9.3¢

Price($)	Vol.	No.
9.5¢	195710	1

Price($)

Vol.

No.

9.5¢

195710

No.	Vol.	Price($)
2	343549	0.093
1	6500	0.092
3	162967	0.091
3	233000	0.090
2	451235	0.089

No.

Vol.

Price($)

343549

0.093

6500

0.092

162967

0.091

233000

0.090

451235

0.089

Price($)	Vol.	No.
0.095	195710	1
0.096	10000	1
0.099	80000	1
0.100	166660	4
0.105	668455	10

Price($)

Vol.

No.

0.095

195710

0.096

10000

0.099

80000

0.100

166660

0.105

668455

(20min delay)
Last 9.5¢		Change -0.010(9.52%)		Mkt cap ! $91.00M

Open	High	Low	Value	Volume
10.0¢	10.0¢	9.4¢	$528.8K	5.444M

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