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CLE - Cyclone Metals

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I dont base it on spec etc etc..I already know they have gone up a lot. But. I am basing it off the deal. I gave the rundowns above. I think if you hold..you'll be fine. With some nice gains to be made.
 
nizar said:
Amazing how every1 here seems astonished with the sell off.
Doesnt any1 remember that this went from 38c to 62c in a few days?

Dont you guys know that these spec stocks can come down as fast as they shot up?

Ever heard of PUMP and DUMP??
Click to expand...

Yes we have all heard of Pump and Dump, the view held is that based on the news it should have gone higher. I think that this is more likely profit taking and that this stock will rise once the profit takers are out.
 

Take your pick, it doesn't really matter.
Yes it is a little disconcerting to watch a stock drop after a ground breaking announcement, just got to hang in there, if you are a long term investor, & not just a speculator.

I have held AZC for years, and even though they are finally into production, the share price has only just started to move in a positive direction.

The positives are that this deal will allow CFE to look into other projects.

It also means that they won't have to go to shareholders for project capital costs.

They will also save about $16-20 million dollars a year in interest , which will go straight to NP.

A year ago Collins Stewart placed a conservative DCF valuation on CFE of AUD 97 cents.

Like Zamac says, probably nothing much will happen to the share price until the resource figure comes out in "4-6 weeks"
 
Announcement just out re additionsal information on Chinese investor. The shares must rise to-day.
 
The JORC confirming the deal will be the one to set the price off. I don't know what this message will do but it definately shows confidence by the chinese.

I would like to say..anything the chinese touch lately turns to gold. Still cheap at these prices. The chinese need commodities and they are cleverly buying anything up that they can which shows great potential.


Glenhaven said:
Announcement just out re additionsal information on Chinese investor. The shares must rise to-day.
Click to expand...
 
nizar said:
Amazing how every1 here seems astonished with the sell off.
Doesnt any1 remember that this went from 38c to 62c in a few days?

Dont you guys know that these spec stocks can come down as fast as they shot up?

Ever heard of PUMP and DUMP??
Click to expand...

Yes Nizar I agree......BHP investors wait 3 years for SP to double ......& CFE does it in 3 days. Wowie !!........traders double their money then get out...onto the next announcement... doing a ...(quote nizar pump &dump)!!
Why wait 6 weeks!! etc etc.
Personally I'm reading up on cfe, researching to buy in for long term......so far it's looking good with all upside..
 
Regardless of the short term oscillations in the SP, the future is looking pretty damn good for CFE. Fully diluted the market cap. is about $200m and in a few months they will have about $275m in cash and still retain 30% of the Cape L project. Mr Ding is exercising 40m options (13.7% of CFE), so obviously he has little doubt about the 300m tonnes of ore being proven up. Confirmation of the resource should be the bomb that gets the SP moving. On a radio broadcast, Tony Sage also states that they are eyeing up a couple of large iron ore projects in Australia and South Africa. Someone on HotCopper wrote that they heard on the grapevine that the South African project was huge. Then again, there's a lot rampers at HC who claim the share they are spruiking will triple by morning tea and be a ten bagger by lunch. Nonetheless, CFE for mine seems to be extremely cheap ATM.
 
When you mention the fully diluted market cap that is also after they receive 38 million in cash from converted oppies. As a 12 month hold im expecting to have some nice profits from these.
 
chris1983 said:
When you mention the fully diluted market cap that is also after they receive 38 million in cash from converted oppies. As a 12 month hold im expecting to have some nice profits from these.
Click to expand...


Just got a bundle @48 cents ... so now have yet another thread to keep an eye on for info. & IMO iron ore looks good for the future
 
captjohn said:
Just got a bundle @48 cents ... so now have yet another thread to keep an eye on for info. & IMO iron ore looks good for the future
Click to expand...

Would you mind buying a few more million at market please? Just take it out of petty cash!
 
captjohn said:
Just got a bundle @48 cents ... so now have yet another thread to keep an eye on for info. & IMO iron ore looks good for the future
Click to expand...

It is a steal. With the deal valued at 75c+ per share fully diluted, and buyer purchased 40m unlisted option. What else do you need?

I guess such opportunity is pretty rare.
 
mmmmining said:
It is a steal. With the deal valued at 75c+ per share fully diluted, and buyer purchased 40m unlisted option. What else do you need?

I guess such opportunity is pretty rare.
Click to expand...

I have to agree with you fully on this one mmmmmining. I got it because I worked out what the deal would be worth for them. All we need is for the deal to be confirmed..IMO its a done deal.
 
chris1983 said:
I have to agree with you fully on this one mmmmmining. I got it because I worked out what the deal would be worth for them. All we need is for the deal to be confirmed..IMO its a done deal.
Click to expand...

I agree. It's a done deal. To trigger the $250m payment, all they have to do is independently varify (3-4 weeks) what they already know they have in the ground . They have many times the 300m tonne resource. Given the weakness in SP at the moment for what the project (and company) is worth, it would be surprising if it wasn't on a few big player's radar. Hopefully some bigger action when the dust settles.
 
I looked to FMG production target on 2008,it is 45 mt/year
and it has 2.4 bil. tonnes resources.
If you compare that to CFE which has 2.5 bil tonnes @30%
Its production target on 2009 is 5-7 mt/year.
Why CFE not having the target as FMG????????????
 
monaliza said:
I looked to FMG production target on 2008,it is 45 mt/year
and it has 2.4 bil. tonnes resources.
If you compare that to CFE which has 2.5 bil tonnes @30%
Its production target on 2009 is 5-7 mt/year.
Why CFE not having the target as FMG????????????
Click to expand...

Different kind of ore. FMG is hematie, can DSO (Direct Shipping Ore) without processing. But CFE is magnetite, need processing into about 65% concentrate. So the processing is the bottleneck.

By the way, for CFE, recoverable resources is about a third of the total resources. 2.5bt magnetite is equal to about 800mt recoverable resources.

Nevertheless, it is still a significant resources, like $48b in ground value, particularly so close to railway and port.

So CFE needs to do a lot of drilling to upgrade the resources to indicate or measured category.
 

hmm thanks for that little overview mmmmining. I dont know too much about iron ore etc etc. I mainly got in due to the deal. I also saw they had a huge resource close to the railway and port as you have stated in your earlier post. If a Chinese investor is willing to back them like he has..to me its a good idea. As long as the deal goes through I feel I am on a great longer term play. The cash at bank they will have is a huge bonus..allows them to explore other avenues such as progressing some other projects or even acquiring some new ones. The oppies will come into play.

"Chinese investor, Mr Ding Liguo, to purchase 40 million unlisted CFE Options(“Options”)"

Thats going to bring us an additional 15 million.

"Mr Ding has confirmed his intention to convert Options to ordinary shares in the near future (providing approx AUD $15 million to company)"

CFEO options also expire on the 31/10/2008. That will bring an additional 38 million. These guys are going to be rolling in money.

Add the 250 million dollar deal into the picture. All they have to do is fund their 30% interest they have retained. See the quoted section below taken from one of the West Australian articles.

"Cape Lambert chief Tony Sage said yesterday the deal with Mr Ding's investment vehicle, Best Decade, would enable the WA Junior to fund fully its remaining share of the $600 million-plus magnetite project near Wickham.

It would also leave $100 million to invest in other projects, once outstanding options are exercised next year."

Okay so they will have 100 million to invest plus the additional 15 million from Mr Ding when he decides to convert his options. 115 million in total they will have and the 30% interest from the Wickham project has allready been funded for. Looks great. They will aquire some other significant projects with that kind of money.
 
chris1983 said:
"Chinese investor, Mr Ding Liguo, to purchase 40 million unlisted CFE Options(“Options”)"
Click to expand...

Mr Ding can see the value of the company, why cannot us? I am pretty sure he might exercise the options very soon if he want a board seat.
 
This looked too low grade for my liking. As mmining says processing is an issue. Its not a world class deposit due to its low grade. However they are looking for african iron ore acquisitions so it is a punt....Usually when buying iron ore you need 58%+ Fe and low phosphorus, silica, and over +150mT tonnage. That is what I'd look for and I currently hold AQA and SRK.
 

Everything has a value, even your old shirt. This is why 2.5bt low grade ore company is worth a nickel compare FMG. There are different ore type, by the way.

We are not getting into two much technical details. I guess a man who is willing to pay $250m, for 70% of the project has put a price on it, You like it or not.

It valued the company over 70c/share on full diluted basis, Plus 10c+/share from option exercise. Total for 80c+.

The company will have 60c+/share cash for this deal on fully diluted basis.

Now the share price is 47.5c because of the risk of no deal. But Mr Ding's purchase of option has almost reduce this risk significantly.

Now the simple mathematics is:

Does it worth to risk 17.5c (assume share will be back to 30c if no deal) to make possible 32.5c+?
 


Ore grades are of absolutely no relevance......the relevance is that CFE define thier JORC on the deposit to 300MT, thats all. The aggreement with BD is binding if so.

Whats of relevance is what CFE management does with the liquid funds from BD. The reality is if they did nothing and just contributed to the JV, shareholders at current SP would be sitting on company with a liquid premium above its MC. Thier rare on the ASX

Hopefully CFE management don't blow the opportunity!
 
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