RE:RE:RE:RE:RE:RE:RE:RE:Simple question from a noobWell, I'm no appraisor of mining assets, but here is an passage from the Proxy
"The Ramu Project is an unincorporated joint venture among MCC Ramu (85% individual share), RNL (8.56% individual share), MRRL (3.94% individual share) and MRML (2.5% individual share). As of the date hereof, RNL has US$114.6 million of outstanding project indebtedness owed to MCC Ramu (being capped development costs plus accumulated interest paid by MCC Ramu to lenders on behalf of RNL up to January 1, 2015 in respect of the Ramu Project). Under the terms of the Ramu Master Agreement, amongst others, upon repayment by both RNL and MRDC of their project indebtedness to MCC Ramu, RNL’s effective share in the Ramu Project would increase by 2.74% to 11.3%. See “ -- Risk Factors” below. In the event RNL’s effective share in the Ramu Project increases to 11.3%, it will have the right to acquire an additional 9.25% interest in the Ramu Project from MCC Ramu at the fair market value." Since MCC paid a total of 2.1B US to dev the project, you can expect that RNL's (Nickel 28th) equity based only on the cost of dev to be 2.1B *8.56% - 114.6 m = 65.16 M USD... This translates to 86M$ CAD... Assuming outstanding shares of 85M, that's 1 dollar a share.
Considering Pala's stake from Cobalt 27 to Nickel 28 will be dropped from 19% to 10%, I would expect for the outstanding shares of Nickel 28 to be bellow 85M outstanding.
Of course, you'll need to ajust the market value of the Ramu project to it's current NAV and discount it for the spilling headaches that the Chinese will have to deal with.
Add to that the various Royalty's and Streaming contracts which I can't personally value, but I would assume would be worth something in any market. The Dumont NSR being the most interesting:
"Dumont is a shovel-ready open pit mine strategically located in the established Abitibi mining camp and contains one of the largest undeveloped nickel and cobalt reserves. An updated feasibility study released by RNC Minerals in June 2019 envisions a 30 year life-of-mine initially producing 33,000 tpa of nickel and ramping up to 50,000 tpa of nickel by year 8 with life-of-mine C1 cash costs of $3.22/lb. Dumont is fully permitted and is in close proximity to roads, rail, airport and a low-cost power supply. The Dumont Nickel-Cobalt Royalty is a life-of-mine 1.75% NSR royalty with a repurchase option on 0.375% of the NSR royalty for US$15 million, exercisable in July 2020." Giving an excercice price at 15M USD for a 0.375% stake, you can imagive what the 1.75% could actually be worth. (70M USD)... Is it worth this now?? Of course not... Could they turn around and sell it to someone for 30M CAD?? Your guess is as good as mine, but I wouldn't mind giving Dumont a value of 35c for a Nickel 28 share, especially after the revised PFS completed by RNX. Now, if RNX could sell it's stake of the project to a more established miner, with the proper means to devellop the project, I think it would provide Nickel 28's share with a good lift.
Nickel 28 will also have 10 other NSR and GRR royalties on it's books... I can't tell you the value of each, but say they could only fetch 2M$ a piece... Well, that would be worth an extra 23.5c a share.
5 million in cash on the balance sheet without debt... 5.8c...
I'm already at a 1.643$ CAD/Share for the value of Nickel 28.
And that's without giving any value to 4M shares of GIGA and 1M share of Minerva.
Yes, KBLT as quite a few pissed off minority shareholders... And perhaps quite a few are exitng there positions now already, which is why you can buy shares of Nickel 28 for 50c a piece.
I wish I could have a crystal ball to know exactly what the price of a Nickel 28 share will be once the dust does settle, but I would anticipate it to be above 1$, personally. You can agree or you can disagree. But buying it for 50c a piece, that's a gamble I'm willing to take considering the high level of emotion associated with this stock and the high level of negativity as proven by your post.
True, there will still be a lot of people exiting the stock once they receive their Nickel 28 shares, but remember that the book value of the shares will be 1.92$, which is all the market will have to evaluate the company as it starts trading.
If you really believe that Nickel 28's shares won't be worth 50c after the close, then sell... I'm not forcing you to buy and you have every right to take what the market gives you now.
But now, you're just bashing your negativity with no numbers and nothing to give your phony valuation any credibility either...
If you want to try and illustrate what you think the value will be with an actual rational approach, I'm definitely listening.
I'll leave you with a last passage from the proxy in order to make up your mind on the value of Nickel 28:
"
Nickel 28 is valued at $2.18 (WELL, 1.92$ now) per share which is comprised of the purchase price that Cobalt 27 paid for each of the assets being transferred to Nickel 28 plus an enhanced value for the Dumont royalty which recently released an updated feasibility study. These assets are primarily leveraged to the price of nickel and all of these assets were purchased in a substantially lower nickel price environment"
SilverKnight wrote: Why is it trading at such a 'discount'? Besides being managed by the same people that just stole the Cobalt 27 assets and unjustly lined their pockets with our money, Nickel 28 is saddled with large project debt. It's flagship asset, and only source of income, just spilled tailings into the sea and is shut down, with the government threatening to close it permanently. Add to that at least a third of the company is owned by pissed off minority shareholders who will sell at the first opportunity, with another good amount of shares owned by arbitrage traders looking to sell after the close. But alas, you focus on the phony valuation those with no credibility tell you it was worth?