Obviously we need to see the official announcement tomorrow, but based on the article, these are my thoughts.
This is a different scenario to a post I put up a few days ago based on the Euroz US$200m
This is actually a better deal because the US$130m is being paid to us, not into “SpinCo” to help finance the company.
It’s irrelavent the Mali govt will take 10-20% because Ganfeng paid that amount knowing they were buying 40-45% not the present 50%.
So Ganfeng have valued the unfunded project at US$130m for 50% or US$260m for 100%
They also said they’d provide “financial assistance” for up to US$40m - This sounds like more of a loan than capital input.
Until we start mining, we each own 50% and have a capex of US$194m, after the $40m financial assistance, we need to chip in about US$77m ea
There is no way Ganfeng will not pay the required US$77m to fund development - they bought it to develop it, and we’ll have US$130m in the bank to pay our portion of the capex.
So effectively they are paying US$130m + US$77m (US$207m) for 50% of a developed Goulamina, or US$414m for 100%.
Add in the $40m financing and Goulamina has an EV of US$454m
Our share of the EV is US$252m or A$327m
At a very minimum & based on our present market cap of $355m, I’d say Morila is worth $250m (I think recent sp rises are based on Goulamina speculation)
So our fair market cap should be in the order of $577m or 73c a share.
That’s probably understating it, as I should really add in the spare US$53m cash we’ll have left over.
There will also be a tax liability on the US$130m paid to us, we have $36.5m tax losses to carry forward and $21.5m of capitalised drilling allocated to Goulamina, + the value shown for it on our books. That extra US$53m above would easily cover any tax bill.
This isn’t a broker valuation that companies rarely achieve, this is conservatively based on our present market cap for Morila, plus what a commercial entity is willing to pay for 50%.
This is a market valuation, if you can buy on market for less than that you’re doing well.
Of course I’ve based this on the Daily Economic news article which may not show the whole story, we’ll have to wait for the official asx release.
