That's a bit disappointing
AVZ Discussion 2022
- Thread starter GazDix
- Start date
Winenut
Go AVZ!
Just sayin'
Fuck me .....at least you copied me enough to actually get the punctuation and grammar correct
At least change to your other account and have a decent go...
Don't muck up spelling this word correctly .....no grammar or punctuation necessary
"Douche"
ozmacca
Regular
100% agree mate. I can’t imagine a single company on earth buying in to this who isn’t already somewhat involved in the (dodgy af) situation. Which sucks for us SH as it’s a tiny tiny group of potential buyers meaning bargaining power ain’t great.
Are there any solid sources for the goss on this thread tonight about asset sale etc?
Hi Sam,
People need to remember that the Mine has a tangible value with or without the Mining Licence. It would be implied that something being negotiated even without the mining license that the DRC have committed to approving the ML after the deal was done (simply an act of price manipulation) - no one is going to buy a dead asset.
Also keep in mind that AVZ has completed all the compliance/due diligence requirements for the issuance of the Mining License. Hmmmm how much did we spend? Its a walk in the park for the next person.
I honestly believe that AVZ is in a very strong position especially with all the litigation that is currently running. FT would want the litigation to end sooner than later - he wont want adverse findings and compensation rulings against the DRC. Oh and the World Bank has also been dragged into this whole debacle indirectly too.
No one is going to invest in a Battery Hub in the DRC without a solid supply of Lithium.
Large corporations must laugh at the shenanigans of the DRC when they are approached by their Ministers. It would be like a remake of the Benny Hill Show (no disrespect to Benny Hill) or Yes Minister.
SilentOne.- Simply a thought bubble
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The Fox
Regular
Thanks Chilla
So are you indicating in your last post that a wholly owned subsidiary like AVZ International Pty Ltd does not need AVZ Minerals Ltd shareholder approval to sell an asset?
I can’t pinpoint the ASX listing rule/s that stipulates if a subsidiary like AVZ International Pty Ltd was to dispose of the interest held in Manono, that the shareholders of AVZ Minerals Ltd would need to vote.
Anyway, if you or anyone else could share a link to the ASX listing rules that covers this item that would be most helpful thanks. If not, no stress, we may find out in the near future anyway if this is at all relevant or not.
Cheers
RHyNO
Regular
Can somebody smarter than me clarify something.
If AVZ sells the asset, let’s say it sells putting the market cap at $5 a share, and then we start trading again. How would this value be reflected in the share price in a speculative marketplace? Obviously the company would be worth that in cash. But who would buy the shares?
If AVZ sells the asset, let’s say it sells putting the market cap at $5 a share, and then we start trading again. How would this value be reflected in the share price in a speculative marketplace? Obviously the company would be worth that in cash. But who would buy the shares?
The value of the company would be cash backing then.
If a company has $200M in cash then it's market cap is not going to be worth $100M. Because investors will know it's value is at least $200M and will buy.
I'm speculating here.
Hypothetically AVZ sell the rights to tenement/assets to A and B for $C amount.
Current holders would get a special dividend payment.
AVZ will have $C in funds but pretty much no physical assets of value. Just cash.
AVZ will exit TH (Question: before or after special dividend payment?).
What that does to SP? No idea, I have not seen something like this before. Usually market cap will reflect current assets... but unsure in this hypothetical case given the issues facing this company.
Hypothetically AVZ sell the rights to tenement/assets to A and B for $C amount.
Current holders would get a special dividend payment.
AVZ will have $C in funds but pretty much no physical assets of value. Just cash.
AVZ will exit TH (Question: before or after special dividend payment?).
What that does to SP? No idea, I have not seen something like this before. Usually market cap will reflect current assets... but unsure in this hypothetical case given the issues facing this company.
RHyNO
Regular
That makes sense, but what compels management to do a special dividend? If Nigel wants to continue his ambitions as a mining magnate, can he just keep the funding and buy into another asset with approval of the BOD? We are shareholders in AVZ, not the deposit itself. Just thinking out loud here. Wondering who if anyone has some insight?
The Fox
Regular
Yes speculating on all this without all the pieces can be a bit frustrating, I'm asking myself is it even worth the effort knowing there are a number of paths forward and an exercise like this is really a bit of guess work to a certain extent.
However, there's not much else to do until we wait on an AVZ announcement to provide the clarity we deserve.
In any evert, under the potential scenario of a asset sale, the company could make a special dividend, (that dividend could be partly or fully franked IMO, depending on how tax paid in the DRC is treated here) or maybe a share buy back would be an option.
Maybe under an asset sale the BOD decide to secure another resource opportunity (AUS?) on or around the same time of selling the interest in Manono? This could mean AVZ is not left without an assert at any stage, or possibly depending on the timing of things, Manono would not be assessed as the only asset held under the company.
Big guesses here on all this, wish I was a Taxation Lawyer as it would be helpful to know if under an asset sale whether shareholders would enjoy some local taxation relief for tax paid on the gain in the DRC.
As others have mentioned, a special dividend is income to shareholders, fully taxable unless there is some franking involved. All questions for a tax lawyer as this information is not easily discernible when reviewing ATO information, nor can I find a precedent.
It would be a shame not to enjoy the CGT discount from selling our AVZ shares in due course, assuming the value is representative of the realisation of a potential asset sale.
Some have said AVZ may not need to trade again on an asset sale, maybe. However trading again on completion of an asset sale may provide the opportunity for a shareholder to exit while others come in to make a clip or margin on any special dividend. Anyway, just kicking this thing as there's not much else to do in the interim, the rabbit hole on these types of scenario's goes deep
Of course all of the above is irrelevant should there be no asset sale, and some new type of JV is agreed, or if a group makes a bid for AVZ Minerals Ltd on the ASX, which would be a cleaner outcome and a preference assuming the pricing is attractive and there's no blocking by the FIRB.
For what it is worth, I think an asset sale is the most likely outcome, yet happy to be surprised with any other outcome for shareholders that provides better value now or in the short term.
Cheers
However, there's not much else to do until we wait on an AVZ announcement to provide the clarity we deserve.
In any evert, under the potential scenario of a asset sale, the company could make a special dividend, (that dividend could be partly or fully franked IMO, depending on how tax paid in the DRC is treated here) or maybe a share buy back would be an option.
Maybe under an asset sale the BOD decide to secure another resource opportunity (AUS?) on or around the same time of selling the interest in Manono? This could mean AVZ is not left without an assert at any stage, or possibly depending on the timing of things, Manono would not be assessed as the only asset held under the company.
Big guesses here on all this, wish I was a Taxation Lawyer as it would be helpful to know if under an asset sale whether shareholders would enjoy some local taxation relief for tax paid on the gain in the DRC.
As others have mentioned, a special dividend is income to shareholders, fully taxable unless there is some franking involved. All questions for a tax lawyer as this information is not easily discernible when reviewing ATO information, nor can I find a precedent.
It would be a shame not to enjoy the CGT discount from selling our AVZ shares in due course, assuming the value is representative of the realisation of a potential asset sale.
Some have said AVZ may not need to trade again on an asset sale, maybe. However trading again on completion of an asset sale may provide the opportunity for a shareholder to exit while others come in to make a clip or margin on any special dividend. Anyway, just kicking this thing as there's not much else to do in the interim, the rabbit hole on these types of scenario's goes deep
Of course all of the above is irrelevant should there be no asset sale, and some new type of JV is agreed, or if a group makes a bid for AVZ Minerals Ltd on the ASX, which would be a cleaner outcome and a preference assuming the pricing is attractive and there's no blocking by the FIRB.
For what it is worth, I think an asset sale is the most likely outcome, yet happy to be surprised with any other outcome for shareholders that provides better value now or in the short term.
Cheers
Winenut
Go AVZ!
Yes speculating on all this without all the pieces can be a bit frustrating, I'm asking myself is it even worth the effort knowing there are a number of paths forward and an exercise like this is really a bit of guess work to a certain extent.
However, there's not much else to do until we wait on an AVZ announcement to provide the clarity we deserve.
In any evert, under the potential scenario of a asset sale, the company could make a special dividend, (that dividend could be partly or fully franked IMO, depending on how tax paid in the DRC is treated here) or maybe a share buy back would be an option.
Maybe under an asset sale the BOD decide to secure another resource opportunity (AUS?) on or around the same time of selling the interest in Manono? This could mean AVZ is not left without an assert at any stage, or possibly depending on the timing of things, Manono would not be assessed as the only asset held under the company.
Big guesses here on all this, wish I was a Taxation Lawyer as it would be helpful to know if under an asset sale whether shareholders would enjoy some local taxation relief for tax paid on the gain in the DRC.
As others have mentioned, a special dividend is income to shareholders, fully taxable unless there is some franking involved. All questions for a tax lawyer as this information is not easily discernible when reviewing ATO information, nor can I find a precedent.
It would be a shame not to enjoy the CGT discount from selling our AVZ shares in due course, assuming the value is representative of the realisation of a potential asset sale.
Some have said AVZ may not need to trade again on an asset sale, maybe. However trading again on completion of an asset sale may provide the opportunity for a shareholder to exit while others come in to make a clip or margin on any special dividend. Anyway, just kicking this thing as there's not much else to do in the interim, the rabbit hole on these types of scenario's goes deep
Of course all of the above is irrelevant should there be no asset sale, and some new type of JV is agreed, or if a group makes a bid for AVZ Minerals Ltd on the ASX, which would be a cleaner outcome and a preference assuming the pricing is attractive and there's no blocking by the FIRB.
For what it is worth, I think an asset sale is the most likely outcome, yet happy to be surprised with any other outcome for shareholders that provides better value now or in the short term.
Cheers
Definitely want CGT discount in any scenario going forward
Should an alternative prevail and we are afforded no CGT relief you may as well be sucking the taxman's dick...
The Fox
Regular
While we’re speculating….
Wouldn’t be beyond the realms to have the ML written into the conditions precedent (same with SH approval obviously)… as others have said, no one in their right mind would be stumping up 5+ bill without the fix being in on the ML - easily fixed with a CP in the asset sale - DRC saves face, purchaser gets surety etc etc.
If it’s of any help, I was balls deep in PSC and we sold (at asset level) to the Chinese (in Zimb)…. In any offshore sale of a major asset, company gets an ATO ruling, in our case it was around 85% special dividend (unfranked of course as it’s off shore) and 15% return of capital (this component is untaxed, but is subtracted from cost base should you later sell the underlying shares)…
So essentially you get a massive bag of cash, then a nasty tax bill (which I was going to pay for by selling a few of my AVZ shares…. Doh).
Cheers,
Powerage
Wouldn’t be beyond the realms to have the ML written into the conditions precedent (same with SH approval obviously)… as others have said, no one in their right mind would be stumping up 5+ bill without the fix being in on the ML - easily fixed with a CP in the asset sale - DRC saves face, purchaser gets surety etc etc.
If it’s of any help, I was balls deep in PSC and we sold (at asset level) to the Chinese (in Zimb)…. In any offshore sale of a major asset, company gets an ATO ruling, in our case it was around 85% special dividend (unfranked of course as it’s off shore) and 15% return of capital (this component is untaxed, but is subtracted from cost base should you later sell the underlying shares)…
So essentially you get a massive bag of cash, then a nasty tax bill (which I was going to pay for by selling a few of my AVZ shares…. Doh).
Cheers,
Powerage
If the asset is gone can we expect our Chinese SH to off load if trading resumes ? Could get very messy . Would be much better if AVZ can retain a stake in the project . If AVZ has a future then obviously all the money wont be dished out to SH . IMO
Azzler
Top 20
I was under the impression that a payout (hopefully some kind of tax favorable method) would happen per share after a settlement date occurs.
This enables the shares to trade again and maintain their price regardless of who sells.
If they state all shares will be payed out at $2 per share for example, the SP will maintain at around $1.99, because knowing a $2 payout is comming will attract endless buyers if people sell at $1.99 or a bit lower.
So you can get out right away at a fraction less, or wait until settlement.
Unless there's special tax considerations and a return to trade is not appropriate.
This enables the shares to trade again and maintain their price regardless of who sells.
If they state all shares will be payed out at $2 per share for example, the SP will maintain at around $1.99, because knowing a $2 payout is comming will attract endless buyers if people sell at $1.99 or a bit lower.
So you can get out right away at a fraction less, or wait until settlement.
Unless there's special tax considerations and a return to trade is not appropriate.
Yes definitely can keep the money and buy another asset.
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