According to the very revealing substantial shareholder...

According to the very revealing substantial shareholder notice,

On 23rd Oct 2013 :

BR took up 1,333,333 + 65,333,334 = 66,666,667 via placement

Plus its Isle of Man subsidiary at 4,000,000 brings the total to 70,666,667 = 5.2%

I always had the perhaps mistaken belief that BR took up a large part of the $20m 10c placement in Nov 2010 and I felt really sorry for them. In fact it appears that IF they did, then they sold down subsequently.. and not necessarily at a loss either.

4,000,000 at 10c is a BR investment of only $400,000 in AVB. A toe in the water.

At 6.5c today, those original placement shares show a $140,000 loss. Not even the cost of the BlackRock annual office party.

At a loss of 7.5c - 6.5c, the recent placement shares...
66,666,667 x (-1.0c) = $666,667 paper loss, for a total paper loss of $800,000

Now the temporary dip in AVB SP is just that.. temporary. Obviously.

I always felt that BR were way behind the eight ball with AVB. That somehow they had huge losses to recoup. That this fact provided some partial justification for the 2% copper royalty on Everything .... Not so!!!

In fact WHEN the SP returns to 7.5c their loss is only that of the orginal shares, a mere $140,000.

So... my scenario of poor BlackRock sitting on massive losses from their past AVB investment and needing a generous compensation deal for their $12m financing is rubbish.

That suggests there is a case for drawing down the least amount of the BR $12m as possible.. and as my previous post demonstrates there is much scope for this!!

The politics of doing so are another matter of course.... but I am not interested in politics, only the figures in this case.

But if you drawn down only $6m of the $12m by careful financial management, then do you only pay 1% ?

Is there some sneaky clause that compels AVB to draw the entire $12m regardless?!

BR is already being compensated by being allowed to buy 66.6m/241m = 28 % of the placement shares at a cheap 7.5c. Yes, CHEAP. Regardless of the spiel about being a modest discount to the current SP etc. and capitalising on SP etc. It is still very cheap, and they KNOW it too.

They are not in the business of acquiring shares in any company at FAIR value. FAIR value is for mugs.

.. just some info for those who take an interest in real facts and figures...