Thank you for your questions Phantom.
To start with, my estimation of EBITDA comes from research intothe EBITDA margins of existing manufacturers such as LG Chem, etc, where I ascertainedthat EBITDA operating margins were between 15% and 20%. I chose 15% for myanalysis.
Next I looked at revenues from a 1.8GWh plant – average batteryprices achieved were between US$115/kWh and US$135/kWh and I am currently usingUS$125/kWh in my modelling. This gives me a base potential revenue of US$225m,which, at a 15% EBITDA margin equates to a potential EBITDA of US$33.75m.
So using your 30x multiple, the implied valuation of thefacility at 1.8GWh is USD1.01bn or AU$1.35bn (@0.75 exchange rate). 63% thenequates to $850m or about $0.98 per share (it looks like you are using 870m MNSshares on issue).
However, in terms of a float, this is not the full story. Itappears that they will use the float to raise capital that would allow for anexpansion to 10GWh. This changes things in a number of ways:
·The valuation on listing will build in the future value at 10GWh (discounted for risk). In a “pure” efficient market, that would be a risk adjusted discount to the value at 10GWh, but these days it is hard to discern just how the risk is treated (eg current value of Rivian at US$110bn).
·The theoretical future valuation at 10GWh at 30x potential EBITDA (using the same criteria as for 1.8GWh) would be US$5.175bn.
·If we assume a 30% discount for risk (takes it to US$3.6bn) and a US$1.0bn capital raise, the pre-money valuation for existing equity of iM3NY is then US$2.6bn in total – equating to about AU$2.50 per MNS share for their 63%.
·Obviously, with a large capital raise, MNS would have their equity in a listed IM3NY diluted – using the scenario I have outlined, MNS would end up with (2.6/3.6 x 0.63 =) 45.5% of a listed iM3NY.
I must stress that all of the above is conjecture at this stage, but it at least seeks to put some metrics around what iM3NY could look like for MNS. Hence the craziness of the past few days over what is a governance issue and not an issue in relation to the assets owned by MNS is quite bizarre. I have been more than happy justto sit and watch, feeling confident that there is nothing from this week that changes the fundamental story and thesis for this company.
You also asked about the listing itself. At this stage the best we know is that they are chasing a listing in Q1 2022. Whether this timing still holds or not may be disclosed in Monday’s AGM. We have no idea of the listing structure and if it may involve some element of in-specie allocation to MNS shareholders (I suspect not).
(20min delay)