Entree Resources Ltd T.ETG

Buy HCU at 25% discount to ETG

[lumpy13]

Although it's thinly traded, HCU's total market cap is a 25% discount to the value of its market holding in ETG.  Plus, HCU has an interest in Hod Maden and a NPI on Antiminas.  SSL will also benefit as it holds 34% of HCU.  

Lots of way to derive value from ETG and its likely acquisition by RIO/OTLLC.  Also, when will arbitration final make a decision.

[Countrygent]

  The company has never been anything more than cryptic about what arbitration relief would precipitate any change in their tax status, Mongolian ownership issues, or any change of ownership.  We don't know what they asked for.  They said "to better align the interests of the parties" but that is double talk nonsense that in itself means nothing. The big hammer

[lumpy13]

Countrygent: You are clearly more knowledgeable than I (and the most knowledgeable on this site concerning ETG).  When I spoke to the company last year, I had understood that it was binding arbitration on determining a resolution between ETG and RIO/OTLLC, which, most likely, would be a sale of ETG.  That would be the most logical for all parties concerned. Any views on my other

[Rock9011]

My thoughts,  ETG is a preferable buy vs HCU because if HCU sells their shares in ETG they must first payoff their loan to SSL. The remainder will be put in a new venture.  Their stock price may appreciate somewhat but how much would be determined on how much they would get for their shares of ETG.  One would still own shares in HCU that would have just sold what I believe would be

[Countrygent]

With regard to the arbitration there is nothing in the Earn In or pro-forma JV Agreement that would compel one party to buy the other out.  And if you go through the company disclosure and NR's they don't say what relief they believe they are entitled to. But it makes sense if ETG can't be granted IA status  and there is controversy about Mongolia taking 34% that ETG is

[lumpy13]

Appreciate your response.  All valid points.  

[HF.mongol.khan]

Hi, Oh, some familiar names from another ...village (just tried to log there and discover the changes). It seems our baby is finally showing nice curves after so many years (long term investment 101! Question: I missed the HCU story and left when SSL was holding the ETG stake. Can somebody exlain what happened in 2 lines? Did SSL injected its ETG stake into another listed entity? thanks

[mrpancake]

Sandstorm  streaming deal with Entree included a private placement.  Under that deal, Sandstorm was required to vote its  25% stake in Entree  with Entree  MGMT.    Nolan "sold" Sandstorms ETG shares to what would became Horizon Copper for a note payable I think it was ($80MM)  [I can't recall] Now Horizon can vote its shares they way

[aldarion8484]

Although it would be great if a public arbitration decision issues, CG (as he discussed in a few recent posts) might be right that there a public decision might not come out.  It is possible that the Arbiration Board has already made a decision that was communicated to the parties, and that the parties agreed to keep it quiet.  The current rise in share price might be the outcome of that

[ScotUK]

I hope you're right on that but it does add to the belief that markets are rigged to suit the big guys.

[aldarion8484]

Maybe not in more liquid shares or in all sectors (e.g., Microsoft or Ely Lilly), but the history of Entree seems to show that a major mining company can control the share price of a junior miner, particularly if it has a considerable shareholding in it.  RIO controls about 17% of Entree.  

[lumpy13]

A few years ago, SAND spun off some of its primary copper assets to an entity, which became HCU.  This included SAND's 30% in Hod Maden, in return for a $100m note and a 20% stream of HM's gold for 50% of the market price (so effectively, HCU kept 10%).  Then, SAND also spun off its 1.6% NPI in Antaminas, for roughly $100m, with SAND having a silver stream, and keeping 0.6% of

[Countrygent]

Lumpy I believe at the time Nolan Watson was saying SSL was being valued by the market as a gold streamer, by projected ounces.  And they were considering trying to find a consolidation partner to raise their market cap and make the combined entity more liquid and attractive to larger institutions.  So taking back a gold stream and dumping the ETG equity to be liquidated eventually (or

[lumpy13]

The most recent presentation by HCU (6/30/24), which gives a good description of its key assets: https://www.horizoncopper.com/wp-content/downloads/Horizon-Presentation.pdf