ipo not bad for gip, page-9

I fail to see how any part of this so-called disinvestment is good for GIP or it's shareholders!!

Firstly Heemskirk:

Using the 70:30 split (because Stellar have the right to increase to 70%) rather than the current 40% attributable to GIP for simplicity.

Based on current Tin price and given the 4.4mt @ 1.1% Sn gives the gross value of c. $1.49B and at Stellar's current Mkt Cap, their 70% entitlement is valued by the market (pre-BFS) at c. 2% of gross.

However under the stated terms of the sale to Adobha, GIP's 30% entitlement works out at just 0.18% gross - proportionally, 11.5 times smaller! Why is this at such a fire sale price?

- there has been no consultation with shareholders
- there has been no independent valuation of the Heemskirk stake held by GIP.

GIP shareholders already own this 30% entitlement to Heemskirk and should certainly not have to buy into another of Gandel's companies (having effectively transferred the asset for peanuts) in order to own an even smaller stake!!

Eritrea:

We are told that the $2.245m loan from GIP must be forgiven for this transaction to go ahead. Yet Tranche 1 only pays $2.2m to GIP - so GIP and it's shareholders get effectively NOTHING for the first 40%.

Tranche 2 (the other $2.2m) is ONLY conditional on Adobha - what's that about?? So actually it may never happen and GIP may end up with ZERO additional funds from this saga.

Note also that Adobha has provided a NON-BINDING letter of comfort to Adobha Eritrea - so again, this actually means nothing at all - at least legally.

I would like to see a clear argument as to how any of this benefits GIP of GIP shareholders in anyway whatsoever.

If it walks like a duck and quacks - it's probably a duck!
Using the same logic I know what this divestment sounds like - but I had better not say so in public!