AUM - Australian Mining Investments

[ALFguy]

anyone have ideas as to what the announcement might be about? Possible take-over?

Expect this will be more drill results...

Or something along the lines of....

"Copper? Did we say Copper?... Sorry, meant Lead"

 

[cuttlefish]

anyone have ideas as to what the announcement might be about? Possible take-over?

It'll probably be more results from their drilling program aobed. If you go on the asx site and look up companies you can see a history of announcements for them - if you read through you'll see their past announcements of drilling results and they are currently doing additional drilling to try to firm up resource size of la minerale deposit plus a couple of other adjacent deposits.

If you look at the info BSD has posted in this thread you can get a comparitive idea of how similar companies are valued.

If looking at AUM market cap and comparing to other companies - remember to factor in options because they have about 50 million on issue - personally I think treating them as having approx 100 mill shares currently on issue is the best way to look at them from a market cap point of view - i.e. dilute with the options now. Also factor in that developing any resource to production stage will cost a lot of $$$ which is often raised by issuing additional capital, and will take years.

From a takeover perspective - X-strata's Ernest Henry deposit is only about 40km's from this one and is getting towards the end of its life - so this resource would possibly be of interest to X-strata but obviously only if the price was right for them. Its even possible x-strata's EH infrastructure could somehow be used for developing AUM's resource.

 

[DOC]

could this be a placement of a large number of shares?

 

[MiningGuru]

This has appeared on The Age website:

AMI in trading halt amid takeover talk
The Age
July 5, 2006 - 12:10PM

Minerals explorer Australian Mining Investments Ltd (AMI) has gone into a trading halt amid speculation about a $17 billion copper discovery and possible bid from Swiss-based mining giant Xstrata.

AMI requested a trading halt pending an announcement around an hour after the start of trading on Wednesday morning, after a recent share spike.

AMI last traded at $7.11, up $1.86 on Tuesday's close, after hitting a high of $10.00 this morning.

The stock has risen strongly since June 29 when it announced an update on its Rocklands Group Copper Project in north-west Queensland.

There is speculation in the market that the project could be worth as much as $17 billion.

This in turn has prompted further rumours that Xstrata will launch a takeover bid in an effort to build up its Queensland copper assets.

 

[ALFguy]

Rumours Rumours...Even on Nine News now, same story as The AGE - take over talks.

Assuming this is the actual announcement (unlikley so early I think), what affect would this have on the price?

My worry is the hype that's undoubtedly going to build up prior to the announcement may impact any 'good' news when trading resumes.

Saying that, the hype is also likely to fuel a buying queue.

 

[profithunter]

In addition to the supposed $17billion deposit, there is a rumour going around that a broker about to release a research report on the stock with a valutaion of $25.

 

[canny]

I wish they'd got the halt half an hour earlier to maintain the integrity of the rise - but ASX probably held it up in processing and caused the mini panic.

Luckily the price had stabilised again around the $7.20 mark - still 35% up on yesterday - and of course a lot more traders in for the quick ride, as we've heard on here today.
The latest figures from testing were due this week ANYWAY - but it was a wise decision to halt it today so that at least when it re-opens we are working on firm figures and a better overall picture.
I took some well deserved profits(!) when it went ballistic - sold some OA's as they were holding their price better than the heads.
I'm expecting the news to be very positive. Even if a placement is included, it'll be an overall win win situation.
They should get $7mill this month, already starting to flow in actually, from the conversion of the AUMOA's. That's a good start for further exploration costs.
Now, while we take a break - take a look at SRK - back up after suspension - and NDO/YGL combo.
Lesm - this was the only way I stood a chance of catching you in the 3 monthly comp!!!! LOL!!!!! I gave everyone fair chance and didn't pick it until after market on 30th!!
Let's enjoy the next leg up too!!

 

[ALFguy]

I notice there is a sell trade queued up at 4.75

Sorry to ask such a newbie question, but when the trading halt is lifted, won't this get snapped up and potentially cause all stop losses around this price to trigger?

I should probably have asked this in the 'Begginners lounge' but it's AUM and I'm trying to factor in some safety

Advice appreciated.

 

[doctorj]

Someone correct me if I'm wrong, but once they release price sensitive news, any buy/sell orders sitting in the queue will get cleared.

 

[cuttlefish]

Isn't it just like the opening price auction that happens at the start of each trading day? (so just like a normal pre-open before trading resumes).

 

[dubiousinfo]

Bullmarket probably explained it best as follows:




Hi Bobby, finnsk

I'll try to explain what happens before the market opens at 10am but the same process is followed during the closing auction (4:00-4:15pm) and before ANY pre-open auction.....ie...usually about 10 mins before a stock resumes after a trading halt for any reason.

The stock market goes into pre-open from 7am during which time anybody can put in whatever bids/offers they like (auction). During pre-open SEATS (Stock Exchange Automated Trading System) then goes thru a 4 stage algorithm to compute the IAP (Indicative Auction Price) based on the mkt depth whenever it changes. The IAP represents what the opening price would be at that particular time based on the current market depth if the stock opened for trading there and then.

At 10am stocks begin trading in alphabetical order. The market is fully open by about 10:08am. When the stock opens for trading, all orders with bids above the IAP and all orders with offers below the IAP are executed at the IAP. The IAP when the stock actually opens becomes the quoted opening price. During pre-open people put in bids above the IAP and offers below the IAP to ensure their orders are executed on opening.

At 4:00pm normal trading stops but again anybody can continue to put in whatever bids/offers they like until 4:15pm, just like in the morning preopen, but the orders aren't executed until 4:15pm. During the 15 mins closing auction SEATS again computes the IAP as above each time the market depth changes. At 4:15pm, for each stock all orders with bids above the IAP and all orders with offers below the IAP are executed at the IAP. In this case the IAP will be the quoted closing price.

I hope this makes sense and helps

 

[ALFguy]

So a pre-open auction would be 10 mins prior to lifting a trading halt, but buy orders have been building since the trading halt.

Surely they won't be wiped from the queue? If so, then why are ppl placing them?

 

[powerkoala]

They just there to make ppl confuse...
if you have E-trade or web iress
you can see the real price settlement when it opens...
therefore.. even buyer build up at $10, but at the moment the settlement price is just $7.50
It just like mind games, ppl will think lot of buyers intend to buy with high prices, but the amount is not enough to make the price goes up.
The real settlement will be when the announcement up.
Whether is a good news or not, this sp already WIN lot.
Hope it helps

 

[sangshim]

Sell orders are building up.... makes me feel nervous since I've dipped my toe in at around $5.

 

[lesm]

Lesm - this was the only way I stood a chance of catching you in the 3 monthly comp!!!! LOL!!!!! I gave everyone fair chance and didn't pick it until after market on 30th!!

Not a problem Canny, c'est la vie.

I learnt after the first comp I entered not to pick them until the evening the comp closes. Won't ever pick one a week out again.

Anyway, you need all the help you can get to catch up, just had to show you the way. : :

Hope you have worked out the numbers, will make it more competitive.

Good to see you managed to make some money along the way. Friday should be interesting and we will see what happens to the share price after that, an interesting month ahead.

Have a good idea which way it will go based on the balance of probabilities. There is already enough information around to work that out, this should be a confirmation. Any unsuspected surprises would make it interesting.

Cheers.

 

[canny]

Cheers lesm -
And AlfGuy, the only time they wipe the buys and sells are when a stock is suspended. This only happens when they can't provide the announcement in the 3 days allowed for a trading halt.
Suspension is the next step (a la SRK) but doesn't mean they've been 'naughty'!!!!!
SO - all these buys and sells will stand providing the ann is out by the due limit - Friday am.
The rest was well explained. IAP was $7.50 last time I looked, but I suspect it's in the hands of the autobots right now - computer placed bids and sells to keep it evenly matched.
However, when the news is released, I'm expecting a large gap up rather than a fall.
It will have taught caution or a hard lesson to a few newer traders no doubt!
Go to the research sites - learn how institutional size buyers can manipulate the market - make a panic set up and everyone chokes and gets out in a mad tumbling hurry - stop losses being triggered, as people clamber over each other in the rush to get out (the $10 trigger) - then they will walk in calmly and do their buying at hte price target they have set to 'let it fall to'.

The secret is: Hold your nerve - don't choke, and if necessary, go fishing!!!
If you've got the nerve you can trade it along the way - but on a stock like this you often lose out - sell at a 'good' price, then have to pay more to get back in.
Sheesh - bring it on!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

 

[ALFguy]

Great reading the stuff you guys (Lesm & Canny) write....

Just wondered how you get the IAP (what is IAP?) at 7.50?
I'm using ETrade and only familiar with viewing queued orders.

Bought in at 8.00 and did hold my nerve as it rocketed to 10.00 and then nose dived to settle around 7.1 Heart in mouth but figured it would close higher - then the halt was announced.

Not going to share your wisdom on which way it will go Lesm?

I too have an idea but it's 50% blind faith, which can't be good.

 

[Prospector]

Not going to share your wisdom on which way it will go Lesm?

I too have an idea but it's 50% blind faith, which can't be good.

And probabilities was my weakest subject

 

[canny]

Great reading the stuff you guys (Lesm & Canny) write....

Just wondered how you get the IAP (what is IAP?) at 7.50?
I'm using ETrade and only familiar with viewing queued orders.

Bought in at 8.00 and did hold my nerve as it rocketed to 10.00 and then nose dived to settle around 7.1 Heart in mouth but figured it would close higher - then the halt was announced.

Not going to share your wisdom on which way it will go Lesm?

I too have an idea but it's 50% blind faith, which can't be good.

ALFGuy - Go back a few posts. 'Dubiousinfo' gave a great run down of the auction system and explained IAP - Indicative Auction Price. You will need a programme with live data to get the IAP updating constantly.
For example - if you're with Commsec, you would need their Pro-Trader - not standard entry.
Don't know if E Trade has a level where IAP is shown?
Hope that helps.

 

[sangshim]

another great story on the Australian..

http://www.theaustralian.news.com.au/story/0,20867,19686554-643,00.html