FFX NPV Calculation - Morila Alone, page-45

I didn't interpret it the way you have, not saying I'm right, just my take on it.

This is what the Doc actually said in the webinar, I've tried to transcribe as accurately as possible.

"It’s a pretty standard process, you appoint a Merchant bank, you have a data room, the merchant bank approaches all sorts of people, people approach you as they already have. You set up a timetable with non binding indicative offers, go thru a short list, then what to do strategically, then there’ll be a bit of tension between the demerger process and that. And depending on which one looks better, or whether you can do them in parallel? I don’t know yet, lets go out there & do some price & value discovery guys eh, lets find out what this is really worth to people. "

My take on that, is the Merchant bank is not there to organise finance, but more to act like an auctioneer to get the best offers possible for Goulamina.

He talks of tension between the demerger process and the non binding indicative offers. I take that as meaning if the offer was good enough they'd just sell the whole thing without demerging. His comment "And depending on which one looks better, or whether you can do them in parallel" tends to support that scenario.

Of course that's just one scenario, with the demerger + partnership scenario they'd try to get the best balance in that as possible.

Interestingly he talks of offers, inferring partnership or outright ownership offers as opposed to offtakes. Offtakes are important to obtain project finance, however I see this whole process as either an outright sale or a partnership whereby the partner buys a percentage of the project and those funds are used to develop the project. Heaps of different scenarios out there, that is the job of the merchant bank to explore.

As someone suggested, this threat (if you want to call it that) of bringing in a merchant bank to auction off all or part of Goulamina, might just incite an offer too good to refuse. After all, this is the 5th biggest Lithium deposit in the World, the resource is open to expansion and is the biggest deposit in the World that is on the market.