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jantrou 3 posts  |  Last Activity: Oct 13, 2014 2:48 PM Member since: Sep 7, 2001
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  • Reply to

    Probably 250 - 300 mio new shares

    by jantrou Sep 10, 2014 3:36 PM
    jantrou jantrou Sep 10, 2014 5:25 PM Flag

    He didn't push, he pushed for a spinoff. Anglogold needs cash and so they have initiated this rights issue and camouflaged it with the spinoff.

    And keep in mind it's a rights issue: huge diluation in number of shares, but 0% diluation for existing shareholders that take part in the rights issue and buy new shares. All they have to do is come up with the cash.

    Shareholders not able to come up with the cash are creamed though.

    Doing the math, newco value + existing debt + Anglogold ZA as 80% of Sibanye value the whole company is still somewhat too expensive currently.

  • The rights issue needs to have a discount to the share price. 1/3 at least because during the procees the share price must not sink below the rights' price to buy new shares. And there needs to be an incentive to buy new shares.
    1/3 less = $8, thats more than 250 mio new shares, more than 60% of currently outstanding shares.

  • Incredible but true.
    Current assets $586 mio
    + unrealized gain on gold holdings in curr. assets $80 mio
    - current liabilities $202 mio
    + $530 mio niobium sale
    + $750 mio revolver
    = $1744 mio

    market cap = $950 mio

    net cash is way lower, because they have $650 mio in long term debt due 2020. And the revolver (to be prolonged in 2016) is of course only financial flexibility and no real cash.

    Iamgold is the last man standing, they have access to so much cash that they can change the company into something completely different at least two times.

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