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"But until we have some more info of what is actually happening...

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youmustbeyoking

336 Posts.

46

09/09/19

16:13

Post #: 40360780
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Originally posted by unicrumba: ↑

...but KDR is sitting on a proven tier 1 resource and not a single other offer? Doesn’t bode well for A40 holders unfortunately...

Few things to remember:

* As you said 'Granted the market for lithium has been on a downward spiral'
* WES made a substantialal offer straight-up, considering they are only getting 50%, are 3-4 years away from any potential income and have to spend many more $millions in the meantime.
* So it's no surprise that no other bids came in when you consider how many other operating mines have lost from their value in the past 3 months.

I personally expect GXY would have indicated an offer of ~$200mil (in whatever combination of script/cash) to A40, would have been confident of a) getting a better offer or b) confident of raising ~$45-50mil and combined with cash on hand + stockpile t still remain the owners of A40, pay off GXY and have enough to continue with a decent drill campaign including COW land and get ready to start up again next year once demand increases, another benefit could be that the fines could be installed while there is a shut down, which would have to happen either way, if we were planning to install the fines at one stage, then we would have enough production to supply the JV hydrox plant and 1-2 Jap/Korea offtakes and out Opex$ would come down substantially.

Throwing around 3-4cens a share ( not just you, but some other punters as well) is a bit unrealistic if that should happen then that means there is no value left in Li and something is happening in the background that most punters are not aware of.

I know, some will laugh at my comment of ~$200mil offer from GXY...reality is GXY needs to do something, NOW, their resource is dwindling, quality is average, SP will only go in one direction until there is an announcement of where they are going to invest in next...A40 still the most compelling option...let's assume even if they offer ~$300-400mil to A40, then spend another ~$20-30mil to install fines circuit and drill out BH and Cowan....I am fairly confident that GXY SP would rise substantially...all their other options will take a lot of $$ and take a long time to reap the benefits.

But until we have some more info of what is actually happening and how much cash is left, we are all guessing.

All IMO

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"But until we have some more info of what is actually happening and how much cash is left, we are all guessing".

At least your guess is fundamental and factually calculated. Not just plain BS downramping. I agree, let's wait and see.

A40 Price at posting: 8.2¢ Sentiment: Hold Disclosure: Held
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