AVZ Discussion 2022

[Spikerama]

Perhaps but not Not necessarily. ICSID vs DRC must be near its conclusion. AVZ paused it twice now for the sake of a possible resolution with the Americans.

The BOD are undoubtedly tired of this saga but not doing this for another 3 years can also mean concluding ICSID with an award for damages if there are no acceptable offers during this final pause.

Although I suspect you may be correct and we will sell to the highest bidder, American or not.

I doubt very much it was near conclusion. It's almost as if it hadn't properly started with all the delays and obfuscation by DRC side.

 

[Sangster]

I doubt very much it was near conclusion. It's almost as if it hadn't properly started with all the delays and obfuscation by DRC side.

If you're referring to the fact we've not yet had a single day actually in court then I see where you're coming from but I've read the commercial courts (ICC, ICSID) are not like the criminal courts.

In criminal matters there may be multiple court hearings separated by discovery of evidence but in civil proceedings such as ICC and ICSID there is a discovery period that can last years with one final hearing at the end.

During discovery both parties submit various documents and replies. Eventually everything has been submitted and reviewed, then we all go to court for a few consecutive days and the arbitrators make a binding decision on who screwed who. As I understand it that's the end, no appeals, but the damages award may take a few more months to be decided and enforcement may also take time.

Looking at the procedural details tab of our case on the ICSID website we have over 2 years of back and forth between parties. I was under the impression our day in court was supposed to be late this year. With the latest pause I figure it must be scheduled for early next year, but I don't know, just guessing.

Does anyone know what the date of our hearing was before the pause?

 

[Powerage]

If you're referring to the fact we've not yet had a single day actually in court then I see where you're coming from but I've read the commercial courts (ICC, ICSID) are not like the criminal courts.

In criminal matters there may be multiple court hearings separated by discovery of evidence but in civil proceedings such as ICC and ICSID there is a discovery period that can last years with one final hearing at the end.

During discovery both parties submit various documents and replies. Eventually everything has been submitted and reviewed, then we all go to court for a few consecutive days and the arbitrators make a binding decision on who screwed who. As I understand it that's the end, no appeals, but the damages award may take a few more months to be decided and enforcement may also take time.

Looking at the procedural details tab of our case on the ICSID website we have over 2 years of back and forth between parties. I was under the impression our day in court was supposed to be late this year. With the latest pause I figure it must be scheduled for early next year, but I don't know, just guessing.

Does anyone know what the date of our hearing was before the pause?

You’ve pretty much nailed it Sangster.

In commercial arbitration there’s no “gotcha” moments, no introduction of new witnesses / expert opinions etc.

All of the heavy lifting is done prior to procedural hearing dates, which means that the likely outcome (within a reasonable degree of accuracy) is much easier for the parties to predict than in a traditional hearing / criminal trial etc.

IMO this could well mean that proceedings were suspended at our request because the outcome of the actual hearing would have been fairly easy to predict and could have crystallised some very uncomfortable truths regarding certain individuals / departments etc - none of which would be conducive to a negotiated settlement with a US entity (ie anti corruption / Magnitsky act etc).

If we had run this, we could well have been in a position of winning the battle but loosing the war (untenable findings for the US) - award of damages would probably have been relatively quick, liquidation probably not that long either, but collection…. Decades if that.

I for one, remain completely supportive of our BOD and know that they have the guidance from some of the best counsel on the planet.

This is basically one of biggest sub Saharan geo-political-commercial shit shows in history with global implications for energy generation and storage. A weaker / less committed board would have folded long ago.

We’ll need more funds for sure, and how we placate our major shareholder in a sale event is anyone’s guess… but for now I’ll wait and hope for the best outcome, knowing that what ever transpires, Nigel and the board have worked tirelessly in shareholders interests.

Bring on the Netflix adaptation!

Good luck everyone.

 

[Dazmac66]

It would appear now is the time for Nigel to get his head in the media to talk up our asset. This should be front page headline news, "Aussie Company Sells Mega Lithium Asset - Come In Spinners" It always feels like AVZ is just the fucking punching bag. Why not turn the tables and talk it up.

 

[Mute22]

It would appear now is the time for Nigel to get his head in the media to talk up our asset. This should be front page headline news, "Aussie Company Sells Mega Lithium Asset - Come In Spinners" It always feels like AVZ is just the fucking punching bag. Why not turn the tables and talk it up.

To what end, to make shareholders feel better?

Any international player with the capital and appetite for a project of this scale will have already been engaged directly through their acquisitions team department, or they’re well aware of the resource size and opportunity here. It’s not exactly something you can miss.

I’d much prefer Nigel stays focused on the three buyers currently in negotiations (four, including KoBold), given the complexity of the logistics, feasibility work and deal structure involved to deliver a contract.

 

[Remark]

Looks like Felix will have to swallow his pride on the 4th December, if he even shows up that is.

https://x.com/KiengeKki/status/1995069294531559787?s=20

 

[wombat74]

Looks like Felix will have to swallow his pride on the 4th December, if he even shows up that is.

View attachment 93428

https://x.com/KiengeKki/status/1995069294531559787?s=20

Sorry , Felix is scheduled to choke on a cream bun prior to the signing in Washington and wont be able to make it .

 

[Ancient]

At first thought I was a little thrown off by this announcement. Because it can seem like it's saying "We've suspended the court case whilst we sort out further litigation funding"... So I thought about it whilst I slept and have now decided my first impression was wrong.

The Manono project is not AVZ. AVZ is a party to the project.

What does funding really mean here? Funding is about project funding. The DRC government is party to the project and also wont be contributing to any funding. CATH are potentially an indirect party to the project according to the revised TIA, in which AVZ has the option to either self fund capital or have CATH fund it. With the later meaning CATH would loan AVZ the capital required and would be paid back through the project revenue. In the scenario where AVZ were to be funded by a loan from CATH, CATH would have rights over 100% of the offtake.

The conditions of the TIA are as follows:

• the Mining Licence being granted to Dathcom;
• the transfer of certain service entities to GLH;
• the CAPEX Funding Agreement is entered into by CATH and GLH;
• a shareholders agreement in respect of GLH is entered into between AVZ, CATH and GLH;
• a revised offtake agreement is entered into between Dathcom and CATH;
• all regulatory approvals and third-party consents required under all applicable laws (including those of the Democratic Republic of Congo and the People's Republic of China) and contractual arrangements having been obtained;
• no material adverse change having occurred.

Now let's just read the latest announcement again.



I am going to have a crack at translating this:
We are currently in discussions with several parties in respects to the sale of AVZ's portion of the project. The other parties recognise the importance of diversifying critical mineral supply chains away from China. I.e., one of these parties has interests in western supply chains, i.e., OEM and/or Government interests.

The next sentence is a bit weird, is it a threat to the western parties to say this is also on the table for Chinese players? Or, are they saying we're assuming that there will be legal obligations to our cornerstone investors (CATH) and these need to be considered in a sale. i.e., the TIA completion is assumed due to expected ML assignment to AVZ from DRC government as part of settlement discussions and therefore any purchaser needs to keep these conditions in mind. Are AVZ trying to encourage pre settlement acquisition which has been theorised about before?

IMO DRC and AVZ have somewhat come to a settlement agreement assuming the offer is right from the party taking over AVZ's portion of the project. The incentives for the DRC government need to be correct... Probably $ for a portion of their project share and a significant funding commitment. The additional consideration is how the negotiation is going with CATH. They want supply, they're going to want to keep as much of that as possible. For them to step aside and let someone else come in to fund the project and take the supply, the price would have to be right or they would need to be out maneuverer through the contracts. I doubt the funding party would only be contributing capital, the acquisition will be about securing western supply, and that will be with the blessing and potential financial backing from US Gov. So many unknowns throughout this...

The summary is that this is a very positive announcement and that they're essentially saying "a resolution is fairly progressed in which we, jointly with the DRC and US Government, can put forward a proposal to candidate purchasers, these purchasers have been presented and are engaged in negations, and now it's a matter of time before the negotiations have progressed to execution".

I easily could be interpreting this all completely wrong.. there's not a great deal to go off tbh

Now that the AGM has been held and some questions have been answered I wanted to return to this post I made earlier.

In this post I had explored the idea that funding may in fact be referring to project funding and from this you could interpret actions and comms as suggesting progress had been made with the DRC government etc.

In the AGM I believe it was made clear that funding is actually legal funding as many believed. Although it was clear in my original post that it was all theoretical and speculation I just wanted to come back and further highlight the inconsistencies in the theory now that further info has been released.

However, whilst we can close the door on some of those ideas I will now open another to think about, also pure speculation:

CATL and AVZ agree to bring forward the TIA and remove the need for the mining licence to be assigned. CATL makes a small upfront payment to help fund legals and receives the ~30% it would have in the revised TIA. If AVZ win ICSID and the mining licence is eventually signed CATL has significant rights on the project + will fund the project development. AVZ share holding reduced significantly but not completely.

With AVZ back against a wall it has no choice but to arrange this 'funding', however, it also creates significant pressures for US stakeholders. 3 Months...

Perhaps the agreement with CATL will be made similar to above and this will really ramp the pressure and start the timer for the US?

 

[Investortug]

Now that the AGM has been held and some questions have been answered I wanted to return to this post I made earlier.

In this post I had explored the idea that funding may in fact be referring to project funding and from this you could interpret actions and comms as suggesting progress had been made with the DRC government etc.

In the AGM I believe it was made clear that funding is actually legal funding as many believed. Although it was clear in my original post that it was all theoretical and speculation I just wanted to come back and further highlight the inconsistencies in the theory now that further info has been released.

However, whilst we can close the door on some of those ideas I will now open another to think about, also pure speculation:

CATL and AVZ agree to bring forward the TIA and remove the need for the mining licence to be assigned. CATL makes a small upfront payment to help fund legals and receives the ~30% it would have in the revised TIA. If AVZ win ICSID and the mining licence is eventually signed CATL has significant rights on the project + will fund the project development. AVZ share holding reduced significantly but not completely.

With AVZ back against a wall it has no choice but to arrange this 'funding', however, it also creates significant pressures for US stakeholders. 3 Months...

Perhaps the agreement with CATL will be made similar to above and this will really ramp the pressure and start the timer for the US?

It was mentioned a couple of times during the AGM by Nigel that the 3 months extension had the potential to get a squabble going between the current bidders (3 plus the tight asses who dropped the first offer)… he also stated a few times that there was about $10m left from CATH was it?? I think the 3 months is an opportunity to raid the ash tray and find a few more quid from support groups to fend off our very own ASIC clown show and the likes of…. Could also be the BODs ensuring they have enough cash to see them/us through to the “4-6 months from an accepted offer”

 

[JNRB]

It was mentioned a couple of times during the AGM by Nigel that the 3 months extension had the potential to get a squabble going between the current bidders (3 plus the tight asses who dropped the first offer)… he also stated a few times that there was about $10m left from CATH was it?? I think the 3 months is an opportunity to raid the ash tray and find a few more quid from support groups to fend off our very own ASIC clown show and the likes of…. Could also be the BODs ensuring they have enough cash to see them/us through to the “4-6 months from an accepted offer”

My wondering...
- actively engaging with Icsid = cash burn
- taking more funds from CATH = locking them further in to the project.
- - so the pause is a way to say 'ok weve delayed it, but here's your window to do a deal USA because else we can and will progress our arrangements with CATH/China'

 

[Hodlandwin69]

So is CATH getting the 30% of Green Lithium Holdings? I thought that was dependent on acquiring the ML, but sounds like the ML will be issued to a US company, i.e whoever buys it

 

[wombat74]

My wondering...
- actively engaging with Icsid = cash burn
- taking more funds from CATH = locking them further in to the project.
- - so the pause is a way to say 'ok weve delayed it, but here's your window to do a deal USA because else we can and will progress our arrangements with CATH/China'

Cath are sitting pretty . And Pei has approx 400mil shares . Box seat win / win either way .

 

[Sangster]

So is CATH getting the 30% of Green Lithium Holdings? I thought that was dependent on acquiring the ML, but sounds like the ML will be issued to a US company, i.e whoever buys it

I suspect we're better of with the licence being issued to the company that buys it provided the value isn't affected by this. CATH we're only supposed to get 30% if they secured the licence for us but this hasn't happened so they have no right to the 30%. However they have assisted with funding so we owe them something, just not as much as that.

 

[Sangster]

I suspect we're better of with the licence being issued to the company that buys it provided the value isn't affected by this. CATH we're only supposed to get 30% if they secured the licence for us but this hasn't happened so they have no right to the 30%. However they have assisted with funding so we owe them something, just not as much as that.

I should add that if our rights to 49% of the processing facilities are maintained as part of the final deal then it may still be warranted to forego the 30% of our mine site. Whatever the case we should deal with CATH honourably. They may have voted against the board previously but Mr Pei has the same rights to an independent opinion as the rest of us do.

 

[Jacob Kiraz]

I should add that if our rights to 49% of the processing facilities are maintained as part of the final deal then it may still be warranted to forego the 30% of our mine site. Whatever the case we should deal with CATH honourably. They may have voted against the board previously but Mr Pei has the same rights to an independent opinion as the rest of us do.

Whats a fair price to accept 60 cents a share, 90 cents etc

 

[Spikerama]

Whats a fair price to accept 60 cents a share, 90 cents etc

A fair price for $AVZ is subjective for every buyer and every seller. So it's probably better to just shut up and stop throwing random prices around and leave it to the grown ups.

But as a response to your arbitrary low ball dart throw, here's a more reasoned and calculated benchmark.

avz-website

ihqdurbg.manus.space

 

[Spikerama]

That $13.79 per share was back in May Spike, lithium has gone up since then

I was being conservative mate.

 

[SilentOne]

Nothing like a quality build.......

https://x.com/africatodayMG/status/1994753342417850590?s=20

 

[Flight996]

Nothing like a quality build.......

https://x.com/africatodayMG/status/1994753342417850590?s=20

Certified by the Victorian Building and Plumbing Commission as compliant with National Construction Code.

 

[Scoota30]

A fair price for $AVZ is subjective for every buyer and every seller. So it's probably better to just shut up and stop throwing random prices around and leave it to the grown ups.

But as a response to your arbitrary low ball dart throw, here's a more reasoned and calculated benchmark.

avz-website

ihqdurbg.manus.space

Hey Spike, this website is awesome. To remove any doubt from potential buyers though, it may pay to show that all figures are in USD so the conservative figure is $13.79 USD per share