Shock and DreadWhen I read the announcement, last night, that Titan was back (they are like herpies or HIV, once you get them they are hard to get rid of), my first reaction was shock and dread. As the absurdity of it quickly struck, I checked the calendar: no not April 1. So I went to bed.
Maybe my subconcious worked on it overnight , but I came up with this. There is no way this merger would ever happen. So many things are much weaker than the first try. If the BOD4 backed it they would be backing up the paddy wagon to load them all in. So why would Titan do it. Well, Titan doesn't have any money. They claim $5 mil in cash, but that $4 mil debt used to buy Core's shares hasn't been paid as far as I can see, and who know how much other debt they have hidden (they never felt the need to pay contractors etc). They have a mill that is losing around $2 mil a qtr. , and now that the ore stock pile they had must be mostly used up, that could get worse. At best they can buy more ore from artisinals, if anyone will sell to them, but the margin is very very thin, if they can in fact get a margin. For sure it wouldn't be enough to pay for the ASX listing and other co. expense.
So their true share price should be somewhere south of zero. But they do have those Core shares, and with that Vertex debt ,could have more. That Vertex deal looks like Vertex just being glad to get rid of it - there is a big stench around Core these past few months, and then the Core BOD4 gave Titan a sweet heart deal by lowering the conversion to 18 cents. If Titan could get a good price for those shares they could recoup some of their merger loses. ( And I don't see anywhere Titan raising money to pay Vertex, so that would be another debt they have.)
And Titan might be in a hurry to get what money out of Titan into personal hands, that they can. Nothing has been heard of the possible charges that Titan faced in Peru for the posioning of Tulin. If the Peruvian authorities were able to put a freeze on Titan's stuff in Peru, but also make claims against them in Australia, that would quickly be the (this time forever) end of Titan. Could be Titan wants to get as much money out before it crashes into ashes.
And to do this they would want to speed up the bidding process, and try to increase the bid price. So by making another offer now, they do put some time pressure on other bidders, and by making an offer of 43 cents a share ,or there abouts, even though the offer in reality would amount to 0 a share, on paper it is 43 and that now represents the floor price for bids. Kind of like a reserve bid.
I wonder where Core is with the mini drilling at DGF? It seems like that would be done as part of the bidding proccess. Zhoajin figure they could get results from drilling in 60 days, within the go shop time, I think it was. So maybe, just maybe ,this will all wrap up by Christmas. And Santa Claus (Mr. Piggott?) , and all his little elves (us) will have a very merry one.