re: kilgor postsI am reading Kilgor's posts and here are my comments:
"I don't think we had a honest concerted effort by our previous management to get a CEO with tungsten mining experience. Goodman wanted preferred shares with voting rights. Each of our management has tried several attempts to screw us out of our shares and I don't see this new management is any different. The only thing that has saved us thus far is the fact that we have the right to vote and voting NO. "
Having shelled 25M of his money into the company, Goodman wanted Woulfe and tried several ways (multiple PPs, special preferred shares etc.). In the end he was caught by the price downdraft and did (or was forced to do) the honorable thing, which was to hand it (including its shares) to technically competent hands (Almonty). I think Dundee average SP is over 20c, so they must believe Almonty can deliver at least that much for them (same as us) in the future. Now this merger conditions may not be what we expected or wanted, and we will get to vote on it. There will be a chance for the shareholders to decide on the merger based on what we know now and will know in the next month. I offer my interpretation just the same as any other here. Right now I am in favor of the merger, with my valuation for Woulfe being about 5% higher than what Almonty is offering (it would be 10% but Almonty has already purchased 5% of Woulfe with their 1M convertible.
"Agreed, which is why I am willing to wait a few years until tungsten prices return to $350 and/or IMC makes a decision on the deal."
We would all like to wait a few years until tungsten prices return to $350. Unfortunately it is not a perfect world and in two years the prices may be good again or may not. either way we may end up owning1/10 or 1/100 of what we have now, or nothing at all, just to keep up with loan repayments and the need to keep the shop open in Korea. I think this waiting is what Dundee was trying to do and was told to cut the BS and get the mine going, which prompted Almonty to enter.
"Why doesn't Almonty wait until IMC say Yeah or Nay to the deal and then propose a merger. All the work to get a deal done with IMC was done by WOF and not ALL. But ALL mgmt being on board may be the final catalyst to getting the deal signed. The bottom line, we are being manipulated and sure ALL has the technical experties, but I don't trust this management."
If all the work was done already, Dundee would not have given up at the last moment. Here is my interpretation of the events: 1) after rejection of the first merger attempt Dundee decides to get the ball rolling with a last ditch effort to get the mine going with the help of the Korean EPC. 2) german poster greuemuetze happens to be in Sangdong just as they were getting ready to present the story to the county and the province, sign the crusher procurement deal and the preliminary construction contracts. 3) Trouble is they do not have IMC on board, given the current tungsten price situation. 4) So there is no clear path to financing, as Dundee does not have alternative solution to the IMC off-take and it is in no mood to pay off the 10M loan to IMC and finance the mine on its own. 5) The County realizes that the Dundee plan is more of the same and reacts badly. 6) Dundee now has no choice but to reach back to Almonty. 7) Mr. Black is made CEO, as on top of its tungsten mining expertise Almonty has access to alternate off-takers and claims to have independent financing that can be used in dealing with IMC.
"Almonty's CEO is our CEO so the CEO and his executive are still in control no matter which company has majority ownership after the proposed merger. The question is why don't they give us a better valuation or why should it matter if we have a larger ownership in the new company. If Almonty shareholders owned 40%, they will still stand to gain because of our massive mine. It shouldn't matter if we had majority ownership unless something else is going on. I sincerely doubt the ALL share price will appreciate if we are to merger and even after we are in production. I wouldn't be surprised if ALL's master plan was to become one of the top 3 largest producers, and then take the company private."
Right now ALmonty and IMC hold the cards. Dundee has decided to hand its Woulfe investment of 25M in the care of ALmonty. IMC can afford to wait for appreciation of their stakes. Almonty on the other hand is motivated to start the two new mines (Sangdong and Valtreixal) as soon as possible, given the planned obsolescence of the current producing mines. Given the previous history, it is very likely that after the merger the A&W shares will appreciate as the mines are taken into production. There is no way to keep that from happening and people from buying shares after prices start going up, and there is no need to take the company private for Mr. Black and associates to realize their gains. If A&W were to become the #3 tungsten producer, its capitalization would be in the $B range (SP>10).
"Ionade.... ALL has already showed their intentions, they want to take us for pennies a share. They are definitely NOT working in our best interests. Most WOF shareholders will take a bath on this merger if it goes through. Secondly if Almonty was such a great company, there wouldn't be so much controversy between them and other companies. Thirdly, if Almonty was a such a great company, wouldn't many other major shareholder take a position in them? Especially if their share price was going to appreciate a whole lot. I do conceed that Almonty has the tungsten knowledge and experties, but that is about it. I think many of the decision makers at IMC are probably on vacation and they will most likely give their investment decision at the time when the loan comes due. It is for this reason Almonty is rushing the merger vote. "
As I have written in another post, Almonty is giving up 40% of its company on top of what has already given to Woulfe as a bridge loan. There are people among the Almonty shareholders that would have preferred maybe a different acquisition. Concerning the controversies with other companies, the reference is with the spat between Ormonde management and Almonty. It now seems clear that Ormonde management closed a bad deal with the Oaktree private capital outfit. The financing deal gave up 70% of the ownership of the mine. Ormonde shareholders now have a financed mine that does not belong to them anymore, all so that current management could keep their jobs and teh guarantee of 1M per year from Oaktree. The market hates this Oaktree deal. Going with the Almonty offer would have been less safe for the management (likely would have been replaced) but much better for shareholders (as the SP behavior clearly shows now).
"LOL..... yeah... I can't wait until Almonty's share price reaches $30/share so my dreams come true too, especially since they are so thinly traded. I wouldn't be surprised if they eventually took their company private. "
Almonty is very closely held. I did research this a while back: in rough numbers close to 50% is in the hands of ALmonty Partners (controlled by Mr. Black), 15% is owned by the original owners of the European mines and 25% owned by the German company that sold them the Australian mine. and now 5% by Dundee. There may be only 5M loose AII shares. The merger will increase the number of shares of Almonty to about 100M, with maybe 40M non-insider shares. This should result in more frequent trading. $30/share is big stretch. Tungsten would have to go back to $500 and A&W would have to acquire several other properties. $10 is doable.
"I totally disagree with Wolfram.... if you bought 100,00 Wof shares at $0.15, your investment would be $15,000. Almonty's Offer of 1 Almonty share for 10.29 Wof shares:: 100,000 x 10.29% = 10,290 shares of Almonty. Almonty would have to be $1.46 a share before you break even. I am sure many of us and the major institutional shareholders paid a whole lot more than $0.15 a shares i.e. between $0.20 and $0.30 a share. For them to break even, Almonty's share price would have to be between $1.94 and $2.92. The way I see it, be prepared to lose if this merger goes through. On the other hand, I don't blame our new CEO for putting though this offer as he must act in the best interests of Almonty."
I understand the total disagreement on the fairness of the merger offer, but these numbers are correct. If one paid 15c per share, the combined A&W would have to appreciate to 1.46 before break even. Based on relative track record in the business and on my interpretation of the current situation, I believe the chances that the combined A&W would go to $1.46 are higher than the chances that WOF alone would go to 15c. Others probably think differently.
"Well said GastownGuy! "
Mr. GastowGuy joined the board after the spike in January that was followed by the first merger offer the next couple of days. He is a short term trader by his own honest admission, and nothing wrong with that. What he wrote is not factually correct, but it is completely understandable from his point of view of a trader that feels trapped with a stock may not appreciate as fast as he was hoping. I also thought this WOF was going to take off quickly after the feasibility report in January. At the time the tungsten trade papers all were forecasting a quick rebound this year and it looked like the perfect time to start development of the mine. As example, the metal-pages outlook last December for 2015 year gave tungsten at over $300 (APT) by now, on its way back to 400 by year end. and instead it is at $200 with no clear bottom in place yet. The extent of China slow down did catch a lot of metal traders by surprise. I am starting to think the slowdown may be priced in at this point. The recent market crash seems to have stopped with some of the blue chips getting gains of 10% per day (stop limited). As for the rebound in the price of tungsten, I believe it is now a matter of customers digesting the existing excess inventory on hand. and summer is the best time to idle mines and processing plants so prices will start to go up in the fall. But this is my reading of the situation. others disagree and see a more prolonged slump. especially the trade rags which have turned all into bears, which by now I have learned to take with grain of salt.