AVZ (ASX) Running discussion on SP

Originally posted by theghostwithin: ↑

There is no mine, and lithium prices are rising off a floor - now is the worst time IMO to be signing offtake agreements.
I am very sure the line is out the door in Monano to have an agreement signed, but we should be taking it slow, making it clear that we know where the market is going and that should be agreed upon before any negotiations on offtake agreements start.

We should be, IMO focussing on shareholders building the company even with cap raises to fund everything to stage 1, stage 2 offtake funding stage 2 and 3.

What I have learnt from being a holder of both PLS and A40 is that with PLS, there has been a diverse range of stakeholders that have had no "controlling stake" of the offtake pipeline, and that control of equity in the business has been maintained by shareholders.

With A40, management took only a few offtake partners (one major and 1-2 minors at any one time) who then dictated the price of offtake, dishonoring agreements. This failure to honor price floors meant that loan covenants were breached, loans provided by direct competition - what a surprise.

It is vital that the lions are kept out of the theme park until the cage is built and the best zoo keepers have the experience to keep the shareholders safe from those with primal instincts and would see us harm.

When stage 1 is underway I hope we would go through a period of plant refinement until we maximise the efficiency of resource extraction (it appears this is where management is headed, reading into their activities) and only then we use cash to move into stage 2.

It is also vital that we keep the likes of Huayou under 10% of holdings and/or entities related to Chinese interests otherwise out of the top 5, or we may find the rudder coming off no matter who controls the wheel. Control of at least 60% of shares by management and long term holders not looking to sell out for a quick buck is vital.

Our holding birefly spiked to 6% average profit yesterday for a while, it was exciting. But we are here until stage 3 and expect to go 100x from 6% before we feel we would have value out of a stage 3 tier 1 future minerals asset.

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„We should be, IMO focussing on shareholders building the company even with cap raises to fund everything to stage 1, stage 2 offtake funding stage 2 and 3.“