Refer below to a post I made under MNM previously, several weeks ago...may provide some more insight.
1. I am backing the management team, from the information I have been able to ascertain, they have spent the best of 12 months looking at the errors of the past. I am sure independent mining experts have also been engaged to also optimise the situation and right the errors of the past.
2. The issue previously with the silver was the grind size and hence recovery was not as good as predicted. Therefore it cost more and they received less. They had too much debt that they could not service, deadly in the GFC. This was a management error in the specs of the plant, not a quality issue with the ore. In hindsight, from my understanding and as you say “it is not rocket science” so i think those issues will be resolved.
3. At $18/oz (price is still around these level today)they will make money when they get back into production. They will have to prove to the market that the errors of the past have been resolved in order to raise the funds required (I estimate $10m). This will involve detailed figures and analysis being provided. They will have to provide those in due course.
4. Exploration upside is very good and should not be underestimated.
5. At $6m market capitalisation with around $2.5 to $3m in cash (1cps raising price) I believe this is a great opportunity Based upon other pre production valuations in the market.
6. They already have the plant and equipment to start production again. (that would cost $10 to $15m if they had to start from scratch)
7. As I said previously, old shareholders have been hammered but that is life. They had the chance to sell out before the company went under and if they were that smart they would have seen the writing on the wall and sold out instead of being a genius after the fact, it’s bad luck.
8. I am looking at this as a new investment opportunity and believe this will trade at a market cap of around $40 to $50m within the first few months of listing. That would be around 6.5 to 8cps.
AYN Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
