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Itafos Inc V.IFOS

Alternate Symbol(s):  MBCF

Itafos Inc. is a phosphate and specialty fertilizer company. Its businesses and projects include Conda, Arraias, Farim, Santana and Araxa. Conda is a vertically integrated phosphate fertilizer business located in Idaho, United States with a production capacity of over 550 Kiloton (kt) per year of mono ammonium phosphate (MAP), merchant grade phosphoric acid (MGA) and ammonium polyphosphate (APP), and approximately 27kt per year of hydrofluorosilicic acid (HFSA). Arraias is a vertically integrated phosphate fertilizer business located in Tocantins, Brazil with a production capacity of approximately 500kt per year of single superphosphate (SSP) and SSP with micronutrients (SSP+). Farim is a phosphate mine project located in Farim, Guinea-Bissau. Santana is a vertically integrated high-grade phosphate mine and fertilizer plant project located in Para, Brazil. Araxa is a vertically integrated rare earth element and niobium mine and extraction plant project located in Minas Gerais, Brazil.


TSXV:IFOS - Post by User

Bullboard Posts
Comment by kisstopherpon Apr 09, 2015 9:32pm
158 Views
Post# 23615032

RE:Pros and Cons

RE:Pros and Cons
masfortuna wrote: Before I post I wish to apologize in advance for the lengthy post.  I will add that I bought today in the .07 range contrary to my usual buuying habits of vetting a stock properly.  I had started doing so 3-4 days ago and my research was incomplete but mbac's announcement forced my hand. I invite anybody here to critique the post  but politely ask pumpers and bashers to please abstain.

Cons:
1.  This company is struggling to kep the lights on. It has a 320 million dollar debt tag that any buyer must include in the purchase offer.
2.  A company that announces prematurely any attemp to be sold with a 5 (!!!!) sentence statement must be aware that it will induce a rise in share price due to speculation. This could be seen as an attempt to allow insiders to dump shares recently purchased fairly cheap (0.01).
3.  This company is not in a position to attract/demand  a favourable sale.  This will lead to a decrease in the actual value of the company vis a vis any offers.

Pros:
1. The company owns 3 properties that are attractive to many other players in this field.
2. The market cap is very low, although many shares exist.  Wether the buying entity pays an extra 20 million or 40 million on the sare price will NOT impact the sale. At  an offer of .20 per share the total is still only 36 million dollars.  The giant in the room is the 320 million.
3. ***** The sp was already at .04 before the announcement. Obviously people felt that this company had turned the corner and would be ready for perhaps a buyout.  I find it hard to believe that now that it sits at .07 cents we would be done.  That 3 cent difference is less than 5 million in the market cap.  So if i get this correctly it's worth .04 cents without a buyout and simply on speculation that one will occur BUT .07 when we are told that offers will arrive in Q2 which should be 4-6 weeks away?
4.  Lastly  anybody that bought today if you wish you could sell tomorrow for minimal loss if sold at a high.  The question would be why did you purchase in the first place.  All flippers are excused because a 114% gain in 1 day is a huge reason to sell, but the big money here is the buyout.  At  .20 it's a triple at these levels.  

So essentially if they sold the debt and get .20 cents per share somebody could buy this for under 350 million...The infrastructure cost and all other cost AND the risk involved in starting from an exploratory level is similar to this amount . So as  a result I bought my core position today with the expectation of a 350 million (minimum) buyout for all 3 properties.  So sell tomorrow if you are unsure but the stock is a question of risk reward and a 300% possible gain in 4-6 weeks is a risk i think is worth taking (albeit don't mortage your house on this).

WHAT AM I MISSING???? 


Your #2 CON is not correct - Insiders are in a blackout period 1. financials aren't released and they are in a strategic review process privy to material information. They can't buy or sell shares.

As staggering as $300+ million in debt is the assets are $500+million and ICL just made a $900 million dollar commitment by buying Alanna Potash.

Bullboard Posts