SDL - Sundance Resources

[nioka]

Here we go into a cap raising ???
Is this good news?

This is the start of the massive dilution that I have talked about as being necessary for SDL to advance towards their goals. I still will continue to hold SDL but I'm not expecting it to be my best investment ever. This may prove to be a good time to buy though. DYOR.

From my post earlier this month.
"If there is one thing that I have learnt over the years it is this;"High prices lead to eventual overproduction and low prices" Often very low and uneconomic prices. That will be SDL's second hurdle. The first hurdle that it hasn't yet overcome is funding. It will get funded but as yet the conditions and the cost of that funding are yet to be announced. When I know the funding details I wll decide whether to stay or go."

 

[Billyjoel]

This is the start of the massive dilution that I have talked about as being necessary for SDL to advance towards their goals. I still will continue to hold SDL but I'm not expecting it to be my best investment ever. This may prove to be a good time to buy though. DYOR.

From my post earlier this month.
"If there is one thing that I have learnt over the years it is this;"High prices lead to eventual overproduction and low prices" Often very low and uneconomic prices. That will be SDL's second hurdle. The first hurdle that it hasn't yet overcome is funding. It will get funded but as yet the conditions and the cost of that funding are yet to be announced. When I know the funding details I wll decide whether to stay or go."

For SDL to go up to its true potential it must first go down hard. Then we get 1 or 2 new major shareholders plus funding equals moving toward project commencement.

Equals share price growth.

Nerves of steel required for the short term.

 

[CarbonSteel]

This is the start of the massive dilution that I have talked about as being necessary for SDL to advance towards their goals. I still will continue to hold SDL but I'm not expecting it to be my best investment ever. This may prove to be a good time to buy though. DYOR.

From my post earlier this month.
"If there is one thing that I have learnt over the years it is this;"High prices lead to eventual overproduction and low prices" Often very low and uneconomic prices. That will be SDL's second hurdle. The first hurdle that it hasn't yet overcome is funding. It will get funded but as yet the conditions and the cost of that funding are yet to be announced. When I know the funding details I wll decide whether to stay or go."

Could also be the beginning of quite the opposite.... the suggested consolidation. I guess it would make sense if they are introducing a finance partner. In fact a new partner may be insisting on it. I do not see any reason for SDL to be raising capital in the general market, so I assume this capital raising is from a partner who has agreed to finance at least part of this project.

Please explain, billyjoel, what is the reasoning behind your statement that " it must first go down hard". I do not understand why this is a prerequisite for improving at a later date.

 

[Billyjoel]

Hi carbonsteel, the deal being built will contain a debt equity position. Debt is normal for a company in this part of its development. A large equity placement say 40% of the company will be dilutive to the share price.

There is however a huge BUT here.

The equity placement may be placed with our debt provider and or with offtake partners.

Which would be very positive to the share price.

As you said, it depends how quickly all information is released. If it comes out completely the share price may simply rise strongly. If it comes out in pieces then the share price may fall before rising.

Either way no a big issue and very exciting times for the company and long term holders.

All the best bj

 

[CarbonSteel]

Hi carbonsteel, the deal being built will contain a debt equity position. Debt is normal for a company in this part of its development. A large equity placement say 40% of the company will be dilutive to the share price.

There is however a huge BUT here.

The equity placement may be placed with our debt provider and or with offtake partners.

Which would be very positive to the share price.

As you said, it depends how quickly all information is released. If it comes out completely the share price may simply rise strongly. If it comes out in pieces then the share price may fall before rising.

Either way no a big issue and very exciting times for the company and long term holders.

All the best bj

Could also be the Cameroon Govt. tipping in their share. I seem to recall from the early days that the Govt. was due to make their claim to 10 - 15% of shares (cant remember the exact %) upon completion of the DFS by contributing 50% of costs to date. Is that still defined as capital raising?

 

[topsprog]

Long term holder SDL from way back.
I have just received an email from Gindalbie announcing further funding from China. Signed in front of our PM and Chinese president in China today. Bit unusual that came to me before ASX reopens tomorrow. However, more to the point, I wonder if George Jones (chairman of both) is over there and trying to concurrently finalise SDL agreement. Just food for thought.

Also in response to last post from carbonsteel, it is my understanding that the Cameroon government is free carried for 10%, with the option to further increase this equity for a contribution of half the costs to date. I must admit I remain a bit confused on this matter after reading the various company releases.

 

[LRG]

IMO the Sundance team have really been caught out spin doctoring over the last few weeks/ months. it is now apparent that Sundance are NOT close to a funding deal at all.

The SP has been heading south now for too long. They were running out of $'s so have got another $60M to keep the expensive planning wheels turning. They keep missing program targets and then slip in 3 month extensions in thier statements hoping no one will really notice. Well people do notice - just look at the SP or the chart it is heading south people.

I am really disappointed with the lack of firming up of previous timelines issued by SDL management which I have taken as gospel and has cost me many $s. Yesterday enough was enough and I exited the remainder of my CFD positions for 42 cents. When they get down to 20 - 25 cents (which IMO they will in the coming months) on a bad world news day - as stops go off, I may buy in again??. I still hold many fully paid shares that I bought at avg 16 cents - it is leveraged CFD trades in SDL that have killed me.

Really I doubt now they will have a funding partner in place by June, now they just talk about getting construction of the infrastructure away by the end of year - is this code for also funding partner by end of year?? Are there really numerous potential partners out there POSCO + 3 or 4 chinese - maybe not? Why are they still releasing "investor presentations" if they are in final negotiations with partners. IMO they are in Panic mode now it is 50/50 if it will ever fly - very disappointed!

 

[Tekwrek]

IMO the Sundance team have really been caught out spin doctoring over the last few weeks/ months. it is now apparent that Sundance are NOT close to a funding deal at all.

The SP has been heading south now for too long. They were running out of $'s so have got another $60M to keep the expensive planning wheels turning. They keep missing program targets and then slip in 3 month extensions in thier statements hoping no one will really notice. Well people do notice - just look at the SP or the chart it is heading south people.

I am really disappointed with the lack of firming up of previous timelines issued by SDL management which I have taken as gospel and has cost me many $s. Yesterday enough was enough and I exited the remainder of my CFD positions for 42 cents. When they get down to 20 - 25 cents (which IMO they will in the coming months) on a bad world news day - as stops go off, I may buy in again??. I still hold many fully paid shares that I bought at avg 16 cents - it is leveraged CFD trades in SDL that have killed me.

Really I doubt now they will have a funding partner in place by June, now they just talk about getting construction of the infrastructure away by the end of year - is this code for also funding partner by end of year?? Are there really numerous potential partners out there POSCO + 3 or 4 chinese - maybe not? Why are they still releasing "investor presentations" if they are in final negotiations with partners. IMO they are in Panic mode now it is 50/50 if it will ever fly - very disappointed!

She does'nt look good further decreases today i also jumped out at 41c time to sit back and watch this stock correct further.

 

[CarbonSteel]

Nah, it was there before this carbon. Guilio stated in DFS release that finance/offtake would be done in 2nd qtr - here's hoping anyway

From Quarterly Report of 20/04/11:
Strategic Partners

"Sundance is pleased with the progress that has been achieved in recent months and looks forward to successfully concluding arrangements for the introduction of strategic partner(s) to the Project and confirmation of project financing and final investment decision prior to the end of 2011."

Certainly does look like this crucial milestone is becoming quite elusive! Maybe we are being fed the same diet as mushrooms now and again.

 

[The Muffin Man]

From Quarterly Report of 20/04/11:
Strategic Partners

"Sundance is pleased with the progress that has been achieved in recent months and looks forward to successfully concluding arrangements for the introduction of strategic partner(s) to the Project and confirmation of project financing and final investment decision prior to the end of 2011."

Certainly does look like this crucial milestone is becoming quite elusive! Maybe we are being fed the same diet as mushrooms now and again.

CarbonSteel, the "final investment decision" has always been slated as being towards the end of 2011. It is a quite separate milestone in the timeline from securing strategic partners. Re-check the timelines and you will see what I mean.

 

[talktome]

The probability of a bounce here is the best we've seen in a while.

By that I mean, the stochastics are rising from a very oversold of just 5-6 out of 100.

That, and we have bounced off a significant price point area of $0.38ish.

It's worthy of a short trade at least.

talktome

 

[talktome]

PS. The bottoming out move was made on increased volume too which brings much added reliability, or at least increased probability.

talktome

PS. You can click on the charts to make them bigger.

 

[Zodiac]

It is of interest the delays over the years to these most important announcments ( Government ratification / Financing ). I would suggest that the board is awaiting on the Exstrata Glencore merge. Exstrata has made its point that it wants its own IO division seperate to its coal. It currently has $22b budgeted for expansion and aquisitions and the Glencore Merge will raise another $10b cash and also give it marvellous access to the markets. West Africa is the only place left where you can become a serious player ( 100m tonne per year ). Exstrata recently purchased majority share of the Zanuka IO depoist in southern Congo - ( approx 500 km away from SDL Congo ). Although a large deposit it only averages 33%. It is having difficulties planning a railway to Port Du Prince. My gut feeling or "hope" is that in reality the deal is done, Exstrata will want SDL and eventually run the railine North to SDL. That is why the Chinese have bought 20% stake of SDL quite suddenly to have some say as it also wants to become a major player with its Belinga mine ( 150km away ) but Gabon is a basket case. The Chinese would much prefer to run a rail link up to Mbalam than set up a seperate track. The hope is for a bidding war between the Chinese and the Swisse for SDL as it has what it takes for the region to open up ( rail / power / port/ stronger soveriegn risk The board and the government is waiting for a catalyst and just maybe this merge is it.

ZODIAC

I would have thought some one would have a comment on the above post. The Board needs to wait for Exstrata to enter the bidding game, Exstrata need to cement the merge with Glencore. In the mean time the board runs the risk of running out of funds which the Chinese would like to see. By further diluting they have called the Chinese bluff and now have the funds to wait. While waiting for Exstrata to enter the game they will prove up more resource and than announce a doubling of export facility to 70m capacity. The Chinese and Exstata will fight over the company. The 5% loss in value is nothing to the 100's% gain that will occur later this year.

Zodiac

 

[RaymondJ]

Personally I bailled about 1 week before the trading halt as the board was just rehashed old news once too often for me. I agree with some of the posts that this board is waiting for a buyout and will use the 60m to hold out. As far as I know there are no signed contracts for construction of the rail or the port facility. The big problem is the Chinese could be possible buyers and they can afford to wait. And what happens when they run out of money next time.
I could be wrong about this but this board has spent a long time and has no signed contracts.

bye now

 

[Billyjoel]

Hi carbonsteel, how low do you think we will go. Bj

 

[CarbonSteel]

Hi carbonsteel, how low do you think we will go. Bj

I don't know now. I am very surprised by the almost 30% loss in the last 30 days.

I guess there is some mitigation in the face of a perceived American debt crisis but when you picked it "going down hard" you were spot on.

I don't trade, so am along for the bumpy ride.

 

[Billyjoel]

Me to...in for long haul and not going anywhere.

Theres details of a secondary prodpectus on asx

asx.com.au
search sdl code
announcements

Might be the db deal?

for interest

 

[CarbonSteel]

Me to...in for long haul and not going anywhere.

Theres details of a secondary prodpectus on asx

asx.com.au
search sdl code
announcements

Might be the db deal?

for interest

The secondary prospectus was for the deal already done with the institutions recently for $60mil.

Not sure what you are referring to when you say "db deal".

The Chinese and Exstata will fight over the company. The 5% loss in value is nothing to the 100's% gain that will occur later this year.

Zodiac

I suggest that the loss in the last month is far greater than 5% if you include reduction in SP along with the effect of dilution. It seems from this forum that smaller investors are becoming disillusioned and walking away. Maybe what the big boys want?
How sure are you that Xstrata is keen and how will they go if CITIC is arranging finance? I would think CITIC would favour Chinese companies.

I would hope that we begin to emerge above the clouds before years end but I will watch Investor Presentations and Quarterly Reports very closely and take note of changes that seem to sometimes be slipped in, hoping that nobody will really notice.

eg: (From an earlier post)

See the International Roadshow Presentation dated 28/01/11, page 16. You can find it here - http://www.asx.com.au/asxpdf/2011012...p32fwd7lx4.pdf - see how the diamond is in the centre of Q2?

Now look at the latest Investor Presentation date 14/04/11, page 17 - 2.5 months later. You can find it here - http://www.asx.com.au/asxpdf/2011041...hbl17p8846.pdf

See how the diamond now straddles Q2 & Q3?

My question is this. Why would they change their schedule in a graphic sense if they still intend to complete Finance/Off-take according to the 2.5 month old International Roadshow Presentation schedule?

I submit that instead of making what would be seen as a negative announcement, they have altered this schedule almost by slight of hand.

Still, since it my nature to go down with the ship while always hoping that rescue is not far off, I'm gonna stick around .... for now.

 

[Zodiac]

The secondary prospectus was for the deal already done with the institutions recently for $60mil.

Not sure what you are referring to when you say "db deal".



I suggest that the loss in the last month is far greater than 5% if you include reduction in SP along with the effect of dilution. It seems from this forum that smaller investors are becoming disillusioned and walking away. Maybe what the big boys want?
How sure are you that Xstrata is keen and how will they go if CITIC is arranging finance? I would think CITIC would favour Chinese companies.

I would hope that we begin to emerge above the clouds before years end but I will watch Investor Presentations and Quarterly Reports very closely and take note of changes that seem to sometimes be slipped in, hoping that nobody will really notice.

eg: (From an earlier post)


Still, since it my nature to go down with the ship while always hoping that rescue is not far off, I'm gonna stick around .... for now.

The board seems to me to be "obviously" acting like amateurs. They have spun so much that they are re spinning same points from 2 years ago. We punters can see this but even with all this Bull *** Hunlong Mining buys a big stake at 44c and Institutions buy at 40c. These two players have done there due deliguence. Something big will happen but it is the timing that is killing the small punter. While we bleed the big boys accumalate. The question I have is why no news from the Govt, surely delay upon delay effects their country. Just look at the heat the Gabon Govt is giving the Chinese about starting Belinga " which they still have not" ( interesting?? ). And the last card is our George who has alot of emotional stake in making sure this is the right deal for the legacy of his friends. What a waste if it is not. I stake my investment on China's desire to break the cartel and Exstata's need for IO.

Zodiac





2) They are maximising the potential value of our IO deposit. The Macro situation of the cartel needs to be broken by the Chinese and Exstrata needs a IO division

 

[talktome]

Well, my $0.38 call was a little premature. It seems to be resistance now with $0.35 - $0.36 being support.

The budget has held back the whole market too in the last couple of days.

Going forward, I think a couple of weeks of going sideways would be healthy for the chart. I can't see it going past $0.42 - $0.46 for a while.

Any chartists out there disagree?

talktome