"I meet lots of promotional and colourful and enthusiastic people in my line of work," Mr Henderson added, " and quite frankly, they are the people needed to get these projects going."
LIFE IS COLOUR !! here's a Minesite late-night double feature :)
September 23, 2008 Chasing The African Minerals Dragon: Value Destruction All Round. By Alastair Ford / www.minesite.com
Spotted, in the Piccadilly Waterstones late on Friday afternoon: one of the head mining honchos at Mirabaud veering perilously close to a book on escapology, looking, perhaps, for inspiration to help him extricate Mirabaud from its increasingly embarrassing association with former heroin dealer Frank Timis and the latest incarnation of Frank's money, African Minerals. The most recent Mirabaud research on African Minerals, which dates back to February, and which bears the fascinating title of "Mispriced Risk", sets a value on Frank's company of 258.5p per share. The shares are now at around 80p. So what's been going on? As usual with one of Frank's companies the answer is: plenty.
To be fair, it's not always been easy to put a value on African Minerals. Back when Frank first ventured out to Sierra Leone, he staked out one of the largest land packages held by any company in the country. But analysts were divided as to how much it was all worth, given that most of the best ground had already been nabbed by the big player in the region, Mano River Resources. The heirs of Harry Winston held a choice bit of ground too, some had already been bagged by Canadians, and Sierra Rutile had a nice project on the beach. Then, early in 2006, London Mining also went into the country, and staked out a nice enough looking package of iron ore properties, consisting of tailings and a potential new development at the historically worked Marampa mine.
So far, so good. Sierra Leone picks itself up out of the mess of civil war, and entrepreneurs and risk-takers pile in. Frank bags a load of ground, and Mirabaud especially likes the look of his Tonkolili iron ore project. It's never that easy with Frank, though. Because, not for the first time, he's got himself tangled up with the law. This time round it's nothing to do with a certain class-A drug that has blighted the inner cities of the western world for decades. No, Frank's reformed, as we'll see later on. This time, it's just a simple row about over-staking. Simple it may be, but it's still shaping up as a fairly juicy spat, because not only has London Mining slapped a writ on African Minerals for over-staking on Marampa, not only has that legal proceeding caused the Sierra Leone government serious pause and precipitated a possible redrafting of the mining legislation out there, and not only has Frank's heroin dealing past been splashed all over the press yet again, but former iron-ore sector golden boys Cape Lambert Iron Ore have now been dragged into the mess too, and in a job-threatening way.
The Cape Lambert side of things is all over the Australian press, and if its not all over the UK press, that's perhaps just because weve got enough chaos going on here already. Minesite's favourite Australian headline on the story so far runs thus: "Cape Lambert faces court in Shemesian schemozzle". It's not quite clear what that means exactly, but the Shemesian in question is Mick Shemesian, who, with 11.4 per cent of the company, has now become Cape Lambert's most significant dissenting shareholder. And, whatever schemozzle really means, the net effects of it are an injunction against Cape Lambert, preventing it from taking a 30 per cent stake in the Marampa subsidiary of African Minerals, and the cancellation of all Cape Lambert boss Tony Sage's travel plans, as he seeks to get that injunction overturned. It's also helped chop yet more value off Cape Lambert's share price, which has halved since the late summer.
The argument over Cape Lamberts Marampa investment centres around whether or not Cape Lambert is overpaying - especially given that title over part of the ground is disputed - and whether or not the deal puts Frank Timis in a position to control Cape Lambert from here on in. Cape Lambert says no, but has yet to convince the courts, or investors. Mr Shemesian initially sought an EGM to discuss the issue, but since that wasn't strictly required by either the ASX or the Aim regulators, Cape Lambert brushed that request aside, claiming a mandate to do deals following the successful sale of the Cape Lambert iron ore property earlier in the year. Mr Shemesian is now seeking the removal of Tony Sage and associated directors from the Cape Lambert board.
A choice bit of business to get mixed up in once again the Frank Timis effect takes hold. Yet, it's amazing how often he manages to do it. Mirabaud have been the proud brokers to African Minerals since April of this year, and Canaccord have held the same title for even longer. One wonders why Frank didn't simply go back to Evolution, where it has to be said, they know him pretty well. As if all that isn't surprising enough, Roy Pitchford is theoretically the main front man for African Minerals, and has been for some time, though word is that he's become a lot shyer than he used to be when he was running Zimplats and Afplats. Still, Roy has previous form in working for what the Australian press calls "colourful" characters. Afplats, after all, was originally a Phil Edmonds company, so in a way African Minerals is the next step up on that "colourful" career ladder. Then there's a fellow called Lord Truscott that Frank seems to have coaxed onto the African Minerals board. A Labour peer, with an unspecified - and hence slightly mysterious - doctorate from Oxford, it's not exactly clear what this man knows about mining, or indeed any other of Frank's interests.
Of course Frank himself isn't so much a businessman these days as a philanthropist. At least that's the impression you get if you pay a visit to franktimis.co.uk, where Frank is described as "an entrepreneur and businessman who has founded and built so many successful mining and resources companies throughout the world over the last 17 years." A nice endorsement. The website goes on to say that he is rarely out of the headlines - true - and that he " is known, sometimes controversially, as a master entrepreneur." But for those who are wondering where the bit is that details how he nearly brought down one of London's most successful mid-tier brokers single handedly, or how he financed his rise from his early romantic status as penniless immigrant in a strange hot country, there's precious little succor. But perhaps that's because that's not the true Frank. " What is not recognized," says Franks own website, " is the work he does behind the scenes as a passionate campaigner for the underprivileged and vulnerable."
Inside the mining industry, it's fairly well known that Frank Timis and Tony Sage are old friends, so perhaps if Mick Shemesian's schemozzle achieves the results that Mick wants, Frank will again be able to step in and show his kind-hearted nature, and offer Tony a new job. Other vulnerable people who spring to mind that Frank may like to consider helping include Philip Richards, the chaps at Serabi Mining, and Gordon Brown. Perhaps we might suggest a donation to the Labour Party?
September 29, 2008
Cape Lambert Could Make Hundreds Of Millions Of Dollars From Marampa, Providing African Minerals Retains The Title.
By Alastair Ford / www.minesite.com
Sources close to the mysterious incident at Waterstones, which took place on Friday 19th September when a senior mining man at Mirabaud was seen apparently veering close to a book on escapology, just as the three-legged legal spat between African Minerals, London Mining and Cape Lambert was really gathering steam, have now informed Minesite that the object of the Mirabaud man's quest was in fact almost certainly a map of Sierra Leone. The scale of the desired map was not specified, but of course if a big enough map was available, such a map could be laid out in a Mirabaud war-room on a large table for the Citys generals to pour over and mark out the staking and over-staking which has taken place on what has been at the centre of all the argument - the Marampa iron ore project.
How much further that would get anyone, towards either a resolution or even an understanding of what's happened, is open to question. But it is probably worth Mirabaud knowing its Sierra Leone geography, so that when London Mining's Chris Brown shouts out in the time-honoured fashion of British political posturing, "Get your tanks off my lawn!" across the markets to African Minerals' chairman Frank Timis, they'll know where the lawn in question actually is. And who's lawn they think it is, too. Because one of the fascinating aspects of the dispute over the little corner of Marampa that everyone's shouting so loudly about, is that both sides seem absolutely convinced of their case. Chris Brown has no doubt he'll win at Marampa, as he told Minesite a couple of weeks ago. On their side, African Minerals, while still keeping their own heads well and truly under the parapet, have at least let it be known through messengers that they are convinced of victory as well. African Minerals has even offered sight of the legal documents that support its case, although sight of Frank Timis remains out of the question.
For a neutral observer such certainty on both sides seems almost suspicious. The outcome of a legal tussle in Sierra Leone is surely never that clear cut in advance. So, for a good-old Blairite third way let's look to Cape Lambert Iron Ore, the cashed-up Aussie iron ore company that's found itself stuck in the middle of this old fashioned staking dispute. Cape Lambert has at least resolved its own internal part of the Marampa kerfuffle. Court action from major shareholder Mick Shemesian, who was attempting to prevent Cape Lambert taking a stake in Marampa, ended last week in an agreement for both sides to pay their own costs. Following sight of the legal details relating to the deal, Mick has agreed that Cape Lambert should take its Marampa stake after all.
So a busy week for Cape Lambert chief Tony Sage, who found time just before the Friday close and a well-earned trip to the pub to watch some football to talk Minesite through exactly what's been going on. He throws an interesting light on the Marampa tussle in the process. First, be it noted Cape Lambert shareholders, he says, that should African Minerals lose their battle over Marampa, " African Minerals have to give Cape Lambert its costs back." Tony may be an old friend of Frank's going back to the days when Frank drove a truck in Northern Australia before introducing Tony to the 13 million ounce Rosia Montana gold deposit in Romania, but business is business. " It's not a soft deal," he says, " shareholders of Cape Lambert are 100 per cent protected." That means that Tony is happy to stand up and be counted as a friend of Frank, but Cape Lambert shareholders will get their money back if Frank's Sierra Leone deal comes unstuck.
Tony is also quite clued up on the detail, since it's actually his team that's been drilling at Marampa, although at no cost to Cape Lambert, and he offers an interesting insight as to why both sides might be confident of victory: " London Mining may win the trespass clause," he says, adding that this is less material to African Minerals, because it was actually Sierra Leone government officials that did the trespassing, not African Minerals. It's therefore conceivable that London Mining will win this element of the case, and African Minerals others, and that both sides will claim victory. For his own part, advised by his legal team, Tony is fairly confident of the African Minerals case.
Not all the mud is coming Frank Timis's way either. One of London Mining's team has been accused in the Sierra Leone press of orchestrating a forgery of mining licenses, and much else besides. What seems increasingly clear is that the Sierra Leone government has got itself in a tangle, probably through bureaucratic confusion between departments. Both sides may be right, because at one time or other some Sierra Leone official may have signed off on title, but it's no wonder the government out there is now looking at a review of licensing policy.
But, if in the short-term, and perhaps even in the long-term, Tony Sage looks likely to get his way over Marampa, his battles aren't finished yet. As far as Marampa itself is concerned, he's confident enough. " We'll build it up to a JORC compliant resource," he says, " and if it's good enough, and then, and only then, we'll buy it with stock or cash." At the moment, he emphasizes, " it's a A$25 million deal, not a A$400 million deal." Not to put too fine a point on it, that outlay is more than paid for by the interest on the company's cash pile, the money that came in after it flipped the Cape Lambert iron ore property earlier in the year. But actually that money in the bank has now become cause for contention itself. Major shareholder Evraz, backed by Chelsea football club supremo Roman Abramovitch, doesn't want Tony to pay out the dividend he's committed to following that deal. And Mick Shemesian hasn't, yet, withdrawn his call for a change at the top at Cape Lambert. So Tony's not out of the woods. A general meeting of Cape Lambert shareholders convened by Mick Shemesian is due on 15th October, at which Mick's company is still, at least at this stage, committed to seeking a change in the board. But says Tony, " I'm confident I'll win, and I'll pay the divi."
If he gets over that final hurdle, Tony can once again get focused on the business of steering Cape Lambert head on into the still-raging iron ore boom. Marampa he reckons he ought to be able to make A$300 million to A$400 million on, if left alone. In the meantime there's also the Cape Lambert South property, nicely located right next to all that lovely infrastructure going in on the main Cape Lambert project. And there's all the other deals that are coming across his desk. " We've had 200 projects come in," he says. " Two or three we're quite keen on." With any luck, the next deal will involve fewer legal hassles than the Marampa deal did. Still, on the plus side, at least Mirabaud now has a nice new map.
CFE Price at posting:
34.0¢ Sentiment: None Disclosure: Not Held
(20min delay)