I have been thinking long and hard about a new theory. Who are the good or bad wolves really?
After detailed anaylsis it is becoming clearer to me that someone large & serious with capacity to manipulate and control Votorantim or Norilsks or Wellingtons or BCEEs actions wants to takeover MBN cheaply and has been trying very very hard to do this since 2013. It has to be the same group who have management on their side and I think BNYM knows who they are.
"The bad wolves appear to have been fighting off 4 attempts at a hostile cheap takeover -
once with DOCA 1.0 (caused by Norilsk & Votorantim, blocked by pumping in US$100M cash)
twice with W BCEE buying sprees halted by the TH,
third time by blocking the US30M recap
fourth time by appointing their own VR over the VA
maybe a fifth attempted takeover will now head to court"
This whole drama started in 2013/14 when Votorantim then Norilsk both seemingly synchronised a breach of their signed contracts and threw MBN into a no income large debt spiral. Why they did that claiming falsely "force dejure" implies a larger play in the works. At around this same time the US & Russia/China started having major geopolitical squabbles with Brasil stuck in the middle playing both sides.
The DOCA shafted Aust shareholders who had like at FMG used large US bond debt to build a massive mining operation from scratch but the DOCA allowed the US NH lenders shares and control and the coordinated attempt led by Votorantim then Norilsk to kill off MBNs US NH lenders failed as they took over and pumped in more money.
Then on relisting i pointed out many times that a secretive group of "wolves" had been manipulating the SP and accumulating shares, when i was proven right when Wellington then BCEE came out in subholder notices I also stated it appeared a 3rd group on broker data was also involved and bad wolves were net sellers led by Comsec & Etrade & CMC brokers.
The accumulations by these 3 "good wolf" groups (may be the same group) built up around 11% +5.5% +~4.5% = ~20% led by Wellington of Boston. I presumed they were good wolves as they were bidding up the SP, flushing the SP up and down 4c-17c-9c-14-8c? This group were buyers and not traders and didnt sell 1 share like the bad wolves on Comsec & Etrade & CMC.
The TH and appointment of a VA stopped this ferocious hostile accumulation on market. The Board stated wrongly the official reason for the TH was illiquidity & lowered NP when it clearly was not then they resigned enmasse meaning the good wolves were set to takeover the board and fund the fresh debt/equity. If these "good wolves" have taken ~20% of the ASX listed stock and were planning to take likely another 15% if the TH had not been called then that would be a threat to the US NHs & CN holders. Management seemed complicit in this as their announcements were up and down but also highly positive.
It appeared that the Board agreed to the good wolves takeover/US$30M & then it appeared that the VA was going to do the same and accept the US$30M deal meaning the US NHs CNHs would be diluted and lose control of their US$500M investment. This has forced the VR to be called in by the "creditors".
4 large serious attempts have been made to takeover MBN from the inside and shaft the US NHs in 2 years, the US NHs have fought back to prevent this and the VR is their last ditch attempt. If the VA & VR and these wolf packs dont agree a Court may have to resolve it unless a trumping unblockable bid now comes in.
These 2 groups appear ideologically intransigent and appear so serious so as to have spent some US$40M - US$100M each and 2 years trying to take or keep control of MBN. The shares are the holy grail of St Rita.
If the "good wolves" group had been allowed to give US$30M in shares/debt at 10c say they may have taken control of MBN & its Board (if they hadnt defacto already) (20% + 20% + creditor rights of say 10%). With the HC rebels with 7% that we know of but say likely 10% out there thats 50% defacto majority control for only US$52M v US$500M paid by the "bad wolves".
I was asked who benefits from a VA, well a defending majority shareholder & a 100% creditor does, unless the VA is against him. The staff dont, the minority holders dont, a hostile buyer doesnt.
so who benefits from a VR, well a defending creditor who is also a defending majority shareholder also. A hostile noncreditor bidder does not. Can a VR state give me US$500M for my US$100M debt? No, no court would allow that. The DOCA guaranteed that.
Who benefits from a liquidation well a cheap buyer who has no shareholdings and no debt investment. But a majority shareholder such as US NHs who converted US$400M debt into shares does not. The US NHs will burn US$300M if a liquidation is called. The "good wolves" may have a stalking 3rd bidder lets say from China so no one really in the current play.
So I am now led to a new theory.
Some legal team in the good wolves group appears to have discovered a loophole and an undefendable position in the DOCA defence set up by US NHs who by taking shares and leaving a small debt have exposed themselves to a cheaper counter-takeover by US30M -US$150M.
The first bid move was this buying spree on market of AUS$25M in cash,
the second move was this US$30M secret Board offer for months as a testing salvo.
It is likely this same group ramped the SP from 4c to 44c in July 2014 also to acquire mass volume of some 100M shares. The price is not their concern but volume is. It is likely they set up the yellow brick road pattern to accumulate another 100M shares on market also. It is likely they set up the plant shutdown debacle with the help of management or others to accumulate another 40M shares cheap.
Ladies & Gentlemen...my new theory is -
A chess game has been played for 2 years by 2 motivated serious large groups both with massive funding & resources and both determined to take or keep control of MBN. We have witnessed 4-5 hostile internal takeover attempts rebuffed thus far by the US NHs.
If my theory is correct, the "good wolves" have CHECKMATE in another 5 moves and their takeover legal team have used the loophole created by the DOCA to stunning effect.
All that is left is for a VA or a Court to approve their "funding package", the "good wolves" pay out the CN with US$48M- US$115M bonds/cash and get CR of 200M shares at 8.3c and a small debt by junk bonds say US$10M which then replaces them as the sole creditor and with their already 20% holdings + 20% new holdings and then maybe a relisting where some US NHs sell out 10% to them... hey presto 50% control of shares and 100% control of the debt for US$70M -$130M cash or junk bonds instead of US$500M like the US NHs.
CHECKMATE!
The US NHs cannot refuse a full payout of the CN debt on any terms, no VR or Court would allow it. Or if the US NHs agree to a liquidation then they buy it for US$250M and the bad wolves lose anyway. The bad wolves suited up & now engaged a VR as they know they have a serious problem here.
Just another theory! It could be BS but it makes sense doesnt it?
If correct Korda Mentha & Ferrier Hodgson will receive a large offer to payout the CNs in full and supplant it with fresh debt and shares. Who would offer US$30M secretly to the Board then let it slide. No, this is someone very very large with a LT eye on MBN for 2 years if im right who has made several secret large moves for it. The DOCA lawyers have been outlawyered and now snookered. Thats what great takeover attorneys are for.
Nugolds appointment of the CEO makes sense. The secret US$30M offer makes sense, the choice of VA make sense, the resignation of the board, the staff sackings make sense, keeping the mine going, spending the last $10M on tailings dams, keeping the CEO & CFO all makes perfect sense on this theory.
Or if the US NHs want to take this private shafting all of us again, the old theory was that they bid for a debt to equity swap at 100% for US$100M CNs like Glencore did for ANL and take all other shareholders shares, something i dont think these good wolves will allow so court action will ensue. But a creditor cannot refuse a full discharge of its debt. So...
