icebergshares unfortunate events

Quite a disappointing evening, I hoped that I would be wrong when I tweeted that a single tweet might be unpopular.

Unfortunately I wasn’t with over 50 replies, and some rather not nice private messages.

1.        “ It won't make me popular but beware of the two Cornhill pumps #ceb #afpo a few placing shares in both comps being offloaded while ramping”

Quite why a simple tweet asking investors just to beware prevoked such anger is interesting. I didn’t say the companies are over valued, I didn’t say the companies were bad investments. I simple stated one aspect that I thought that investors needed to know/research before investing. Indeed in a follow up tweet I said that just because a company is being ramped while placement shares are being offloaded , doesn’t make that company good or bad. No, certain ego’s felt threatened and out came the insults.

I deliberately didn’t name any names, or make anything personal, as to be honest that’s not me. I care more about the research that folks need to perform and should do on shares, that research should include the brokers, nomads of companies and how money might be raised.

Quite often when this happens the companies are actually quite good/even very good investments, as these are actually easier to pump. The problem is more, that the crew’s move on to the next big thing and the market then becomes flooded, leading to a fall in the share price.

Two or three years ago, companies used YA, Darwin, Bergen to raise cash, investors realised that this killed share prices, as they offloaded into any hint of a share rise for small percentage gains. Now a new way of raising cash is used…

Each share is dealt with differently, but it’s clear that some folks have brought into a placement and flipped, or brought into a placement, ramped the share up, started shorting and then sold the share back down again (why not make money on both the up and down sides of the spike).

Again I won’t name investors, but the fact that, CEB, AFPO, SER, NEW, TEA, RRR all have either Cornhill as their broker or Beaumont as their Nomad, can’t be a coincidence can it? And when we have both of them together, such as with NEW we get some of the worse greed and corporate activity known on AIM.

This piece hasn’t come out of nowhere , I’ve been posting for a few months that investors need to research not only the company but the companies, supporting that company.

I do hope that those folk that seemed to take everything so personally last night, carm down a bit. It all reminds me of the bad old days on the BB’s when a single voice who dared questioned anything got shot down in flames.

Money does strange things to folks.

BTW I am fully aware that we have various (investment) groups on Twitter that seem to take everything personally. For information only I am not with any of them and couldn’t careless. The only thing that I want is a playing field that’s as level as possible for everyone.

Savannah Resources – Joint Venture of the Decade.

I’ve been a fan of Savannah Resources since the company was first created, as such I have a reasonable sized holding in the company.

http://icebergshares.blogspot.co.uk/2015/01/

Above was my last blog at the start of the year.

For the world’s largest company to consider a joint venture with a small minnow on AIM is mind blowing. Its often talked about on the BB’s but is rarer than a hen laying golden eggs.

Savannah Resources have achieved this.

They have only achieved this due to the very high professional standards the company demonstrates and the expertise and experience of the management team and BOD (including of course David Archer).

A few nicely hidden bits of the agreement are that Rio can buyout Savannah, but only for a multiple of all the money that SAV have already invested.

Scoping to be completed hopefully 2015 earns SAV a 20% share in the combined JV.

A pre-FS gives SAV 35%

A full DFS gives SAV 51%.

The full JV seems to be “Rio Tinto's affiliate of the three areas suggests a combined potential contained ilmenite content of between 140 and 170 million tonnes with a further 10-15 million tonnes of contained zircon and rutile.” This gives us a combined resource value of around $2billion for the RIO licenses, with approx. a further $1bn (very conservative) from the SAV licenses. Total (conservative values of $3bn).

The aim is produce a mine in the near short term with approx. $200m of revenue’s per year. The cost of the mine will be low and 50% of this cost will be paid by Rio Tinto. Along with this Rio will buy everything that the min produces at commercially available prices…

One of the biggest barriers and risks to "wannerbe" miners are the funding uncertainties and selling your output when the mine is actively producing. Due to this many miners have DFS’s for their exploration areas which are mothballed.

The current JV effectively cancels out these risks. Any mine where 50% of the costs are being picked up by the world’s largest mining company will not struggle to get project finance.

Today’s announcement really does confirm that Savanah is on course to become a mid-cap producer with a £100m+ Mcap. I’ve already said that I held in 2013 – all the way through 2014 and will still be holding in 2016.

I’ll leave the sentiment plays-flip flopping and P&D’s to others.

Quality Shines though and even if it’s not seen by all PI’s has certainly been seen by Rio Tinto.

Well Done.

UKOG – The magic dust fades away.

I’ve written about UKOG over the past year. So this is just a very quick update, which even if one person stops and thinks will be worthwhile.

If there is so much oil just waiting, all over the Weald to gush out of the ground, then why hasn’t the plethora of drills over the last 20-30 years found much?

The answer if we are to believe David Lenigas, is that new technology and extraction techniques now make it possible to squeeze it like a sponge and for the oil to flood out.

The new technologies that he’s talking about, are of course not particularly new as they are used elsewhere in the world, not least in the areas mentioned in the “Independent Reports” that have been commissioned by UKOG. These new technologies concern the ability to naturally frack existing fissures in the rock and lateral extensions to wells, allowing for far greater horizontal pay zone extraction.

Lateral extensions are used extensively at Wytch Farm in Dorset in similar geological formations to those targeted by UKOG. They stretch miles out to sea in an area where lateral extensions will have no impact on people’s lives. They generate on average, a few hundred barrels of oil a day per a drill.

It is important to understand that the reason that Wytch Farm is productive is that it’s a natural collection point for the oil that has migrated from the Weald i.e the movable oil.

Even if UKOG is allowed to drill large laterals under the rich homes of Southern England the output is very unlikely to meet the more movable oil found at Wytch.

The only way that UKOG will be an amazing company, is if the new technology talked about can materialise oil out of rock, Star Trek like in transporter beams…

Have a good weekend.

Open letter to Beaumont Cornish, New World Oil and Gas’s Nomad.

I tried speaking to you yesterday, but unfortunately I was told that you could not speak to me, due to internal, self imposed rules.

I wanted to raise with you a number of concerns and potential breaches of governance that I feel might exist with a client of yours “New World Oil and Gas” (NEW).

In a recent RNS concerning the open offer, which you approved they issued the following statement.

 “The current cash position of the Company (as at opening of business on 8 June 2015), excluding any funds owed to the Company pursuant to the Al Maraam SPA, stands at approximately £290,000. Based upon the current rate of spending and in the absence of raising any funds pursuant to the Placing and Open Offer, the Directors expect this balance to last for no more than three months…..

….If the Company and Cornhill Capital are unable to identify or agree on such steps, the Board may be faced with no alternative but to commence winding-up of the Company.”

It clearly says that the company has a very unhealthy financial position that will cause it to go bankrupt within a matter of weeks (maximum 12-14 weeks).

It is clear that this has been known to the company for quite a while and that the funds sought from April’s placing were needed to prevent bankruptcy. At no point until after the shares were suspended was this made public to the shareholders.

The below is taken from the London Stock Exchanges own rules for companies, which I am sure you are aware of.

“General disclosure of price sensitive information

11. An AIM company must issue notification without delay of any new developments which are not public knowledge which, if made public, would be likely to lead to a significant movement in the price of its AIM securities. By way of example, this may include matters concerning a change in:

 its financial condition; “

 

So it’s very clear that investors were mislead when buying prior to suspension by incomplete but known information on the company’s financial condition. Investors were also mislead when asked to vote in the placement as this didn’t have this information. NEW and yourself also failed to inform investors of a material change in its financial condition.

 

The following also taken from the stock exchanges clearly details where responsibility of this lies.

 

“ensure that each of its directors accepts full responsibility, collectively and individually, for its compliance with these rules; “

 

The directors must accept responsibility for this.

 

http://www.londonstockexchange.com/companies-and-advisors/aim/advisers/rules/regulation.htm

 

The below is taken from the nomads responsibilities, which is linked above.

 

“MONITOR TRADING

OR3 – The nominated adviser should monitor (or have in place procedures with third parties for monitoring) the trading activity in securities of an AIM company for which it acts, especially when there is unpublished price sensitive information in relation to the AIM company

In meeting this, the nominated adviser should usually:

 use suitable alerts or other triggers to alert the nominated adviser to substantial price or trading movements. This can be satisfied via the broker

 contact an AIM company where appropriate if there is a substantial movement to ascertain whether an announcement or other action is required, liaising with the Exchange where appropriate

 consider the necessity for arranging relevant press monitoring, particularly when there is material unpublished price sensitive information in existence “

 

As soon as the exceptionally large volumes started as a Nomad you should have noticed and requested suspension of the share price.

Did this monitoring happen?

Did a request go to the LSE?

When did these things happen?.

 

Finally we come to the open offer itself. There is considerable confusion between brokers as to who qualifies for the open offer. Many brokers are offering the open offer to unsettled holders, however the offer document and the RNS that was released, clearly talk about only settled shares taking part in the open offer. I am sure that you can appreciate that its impossible for me as an investor to accurately judge whether to take the financial risk of subscribing without having full information about who can actually subscribe. Any clarity you can provide here would be appreciated.

I am sure you are also aware that the correct documentation is also not going to the potential subscribers.

 

I am sending you this email in the hope, but not the expectation that you will respond. However I am also sending a copy of this letter to the London Stock Exchange to investigate as a matter of urgency the issues raised.

NEW, Will the Nomad perform it’s legal duty?

NEW, Will the Nomad perform it’s legal duty?

Another week, another monumental cock up by the NEW board of directors.

It’s difficult to believe how badly they are actually getting things.

The latest RNS confirms that at the EGM investors were mislead about the BOD’s pay and loan arrangements.

Despite swearing blind that they would issue an open offer, underwritten to the tune of £1.5 by Cornhill at .05p a share. They have announced an open offer at .09p a share to raise £3.5m.

Also apparently they have to raise £3.5m to prevent the company from going under, despite being happy with £1.5m only 2 months ago.

They seem happy to pay £750k to Cornhill, despite the fact that its Cornhill who needs the shares, due to their own scheming and greed.

On top of all this, the BOD themselves don’t want to/haven’t got the confidence to buy shares in the open offer….

But the above is only the backdrop for the real story.

Will Beaumont Cornish actually perform its duty? 

Let’s be clear about this, the duty of a Nomad is to ensure that the company meets its requirements to the London Stock Exchange.

New World Oil and Gas are clearly stating in an RNS that only registered holders of shares (750m of them)  can take part in the open offer.

The London Stock Exchange are equally clear, ALL holders of NEW shares, whether settled or unsettled have full rights and can take part in the open offer(common guidance is at least 2000m of these shares).

Brokers are equally unclear. There is one broker who says that unsettled shares can take part in the open offer. One broker who says that they can’t and more alarmingly one broker, whom I have x million shares with who can’t tell me either way and can’t tell me whether the shares are settled or not, because they can’t reconcile their own internal share situation……

The Nomad MUST act.

They have a legal, licensed duty to ensure that NEW comply with the guidelines and rules of the London Stock Exchange and the Board of Directors are NOT.

I will certainly be ringing the Nomad on Monday and writing to them(for evidence) to ensure that the NEW open offer does not go ahead in its present form.

On a brighter note. The LSE statement that unsettled shares should have all the rights attached to settled shares, must surely mean that a 10% holding of unsettled shares should be sufficient to hold an EGM?

The Board of Directors will be hiding behind Jersey Law, but my understanding is that London Stock Exchange Rules trumps this and hopefully the BOD can be kicked out to do a job they are capable of….(I’ll leave any suggestions for this to readers).

Icebergshares - New open offer

**Nothing that I write here constitutes advice for anybody, this is purely my own personal opinion on the current situation**

Well we’ve just had the RNS that we all knew was coming from New World Oil and Gas. It was all about the number of shares issued, rather than the issue price really.
The issue price only determines how many shares are taken up by Private Investors in the open offer and indicates a floor price for the company.

The number of shares indicates how many of the shares are going to be used to cover the short fall, obviously the lower the better. NEW could have issued anywhere between 1bn and 7bn shares. The final amount of 3.8 billion is not good, but is far from a disaster.
A few points.

Yes the company needs funds to survive, it is disingenuous of the BOD to blame the EGM NO vote on the survival of the company. The NO vote was due to the price the shares were being issued at. Everyone knew that some kind of share issue/fund raising was needed. The question is what is best for the company. Was an issue of 3bn shares at .05 good for company?, given the resulting actions today by the BOD the answer is an obvious NO, this means everybody who voted NO has actually put the company in a much better position.

Does the company need to raise £3.5m to survive? Blatantly not, given that they were happy to raise £1.5m just 2 months ago!.

Cornhill could have just paid £1.5m @ .009 for 1.5bn shares. From this it’s obvious that there is the need for the extra 2.3bn shares.


The company acknowledges that £3.5m will be raised, however only £2.8m net of associated costs etc related to this debacle. So the company has spent/will spend £.7m on this mess. Quite an achievement for a company with such small reserves!.


Next Steps


Investors need to make a few decisions.


Do they:
1) Invest in the Open Offer, use this opportunity to average down. For example if you brought 100k at .5p and your shares are settled then you can buy 500k at .09p giving you an average of around .016p. Given the base price of .09, cash in hand, assets etc a price of .12 maybe .13 as a minimum to sell is still possible. This would reduce your loss potentially from £4k down to £1k or £2k.


2) Sit tight. If the majority of the placing shares are brought by private investors in the open offer then Cornhill, it’s clients, the Market Makers and other short interested groups will still not have the shares they need and will need to purchase them on the open market. Its possible for a short squeeze to still occur.


3) Complain to your broker. If you brought shares that have not settled, you were given no warning by the broker when you brought that the shares would not settle and maybe even received indicated via a website that the shares had settled then you might well want to demand your money back. You probably brought under the assumption that you were buying shares and that the shares would settle in accordance to the brokers own statements. That you could average down in any open offer and maintain your position. Some shares have been settled, some have not. So your broker could have and should have fought on your behalf for what was yours…
You have been materially disadvantaged by your broker being unable or unwilling to settle the shares at the prices paid, this is despite a contract with them saying this. Keep it simply but demand your money back and threaten ombudsman if this doesn’t work.




What investors choose to do is up to them. Personally I think NEW will still be a reasonable company, particularly if the BOD get ditched. Money in the bank, new exciting Middle East projects about to be started. If we look at what the pile of shit SER did and how it was valued. I get the feeling that even with the open offer the price will be over .3 in the not too distant future…

Icebergshares: Battle for Planet NWOG.

The market doesn’t do anything out of whim or whimsy. So why did various people take a position in NEW? Why does there seem to be a battle for a company with no assets…? Why is the current SP .26?

So many questions, so few answers…

A few points NEW is cash rich, they have:

1. £400k in the bank.
2. £1m left to be paid  from the Niel deal.
3. £800k owed to them by director loans.

Total £2.2m without a placing..current MCAP without a placing £1.83m, the market stabilised at this level, not through chance, but it’s a simple cash in the bank value.

Given the OO go ahead, we could easily add £1.5m to this.

We’ve also got the Danish CPR due next month, this is expected to put a risk adjusted value of £2m on the resource and is the blocker preventing successful farm in.

The AIM listing for a cash rich shell company should add a further £500k-£1m to the Mcap.

Given all this anybody buying into NEW its lower price is set to make a handy sum of money.

I do wonder whether this was the plan all along, get the SP to its low of the low figure, issue hundreds of millions of shares or warrants to the BOD, see a dramatic rise in the SP, thanks to the valuable CPR, farm in and added highly lucrative new project.

The only problem is that several other people saw this as well, notably Chris and BMD and MTR.  Buying of stock took place. Suddenly it dawned on folks that a short squeeze was on. The price rose to .8p which was the trigger for selling as this was no doubt the exit strategy for a few folks given the above calculations.

Lets make it very very clear that even at the current value the company is still undervalued and could still see a multi-bag even without any short squeeze, don’t believe folks that tell you otherwise.

The company will resume trading very quickly, there is no doubt as to whether or not NEW is a “going concern”.

#NEW New World Oil and Gas – Don’t worry be happy…

#NEW – Don’t worry be happy…

There are lots of rather silly bits of speculation about motives, conspiracy theories etc on the BB’s. I would urge investors to concentrate on the facts and what might realistically happen.

• Private Investors won a fantastic victory with a NO vote for the cheap BOD shares and a NO vote for the placement shares.
• Cornhill has not been given 2.5bn shares it can happily give to its clients or to those that thought they had participated in the placement.
• The BOD know that a majority of shareholders are very unhappy with them, that those shareholders are now a sizeable cohesive block.
• The shares are suspended until the market can function correctly and shares can settle.

 

With 2 billion shares needed in the market, (we know this number as most brokers only have between 10-40% of shares settled), we know that the market can absorb 2bn shares without it effecting anything at the moment.

The only place these extra shares could have come from, are from short positions taken out by folks who thought they have guaranteed shares, but instead have simply taken out naked shorts to the tune of 3 times of the current share base.

If every share currently in circulation was brought by Cornhill and the other brokers it would still leave a shortfall of 1.3bn shares. This would obviously require a very high price to be paid.

The LSE are saying then that the shares will be suspended until and unless they get a guarantee of at least 1.3bn shares entering the market.

The only way the new shares can enter the market is either through a placing (which would need a vote) or an open offer.

No investors like to see their ability to buy or sell taken away from them, but we need to look at the bigger picture. For current investors we have a few things to think about.

How many shares will be issued?

Who will the shares be issued to?

At what price will the shares be issued?

With regards to how many shares, the fewer shares issued the better, however even if 2.8bn shares are issued, the answer to the other two questions will determine how good or bad this is to investors.

The shares will be/must legally be, offered to current shareholders first. Only after this will the leftovers go to Cornhill, or whoever NEW use to underwrite the offer. Current shareholders will snap up most of the shares if the price is .05p leaving maybe .5 to 1bn shares for Cornhill. If we increase the price to say 1p and decrease the number of shares to 1.5bn then it might well leave 800m to 1bn shares for Cornhill but at a much higher price.

This is just my own calculation but I can see around 2bn shares being held by investors who are trying to force the short squeeze. Brokers need 1.3bn shares to settle these trades already made. Flippers and shorters who have found themselves in a naked position need a further 1.5bn shares as a minimum. Given all of this, current holders of stock, and those that take part in an open offer will find their shares very much in demand when the trading resumes.

What price they get on the open market, will depend on how quickly brokers and shorters want to settle accounts and what the current holders decide to sell out at. I am pretty sure it’s far higher than the current price though.

For these reasons I am very happy with how things currently stand.

Ignore a lot of the uncertainty around the share, BMD and Chris might make an offer, BMD is certainly very good at pumping stocks up(although I am not really interested in being in that kind of stock).

Something might or should happen to Cornhill.

An EGM might or might not be called to vote out the current BOD.

But as an investor all we really care about is the bottom line and for me that’s looking healthy when it moves out of suspension. I am genuinely happy, not worried.

#NEW the way out of wonderland.

#NEW the way out of wonderland.

The more it goes on, the more I am reminded of Alice in Wonderland. Mysterious smoking Caterpillars, Cheshire cats and Mad Hatters. I will leave folks to figure out who might be who in this scenario and who is the Queen of Hearts…

Anyway so following on from Ben’s excellent feedback from the EGM. We have an independent count in place for the votes. This is mind-blowingly good news, the BOD have also had to confirm that the register is in such a mess that it can’t even count the votes accurately.

A lot of side line investors kept repeating the mantra, that EGM’s will rubber stamp it, the BOD will get their way they always do….This is true nearly of the time, but is blatantly not true this time, with this EGM.

Going forward we need to find a way out of this wonderland. The FCA/LSE does not like to deal with things “in the open”, instead a way forward will be found which satisfies all parties to a degree and one that keeps everything working. It won’t really care what happens as long as everything is seen to be “working”.

A number of behind the scenes, happenings have occurred. We have a stock that has now been suspended. We have a broker who has supported and organised the placement and the 2bn none existent shares, who has a web site that has been down for “maintenance” for days now. Whether you believe this, in a world of 24hr hosting support, for a small and simple website is up to you.

The only thing we need for a full house is some kind of sanction against the nomad, or for their website to “go down for maintenance”.

The FCA/LSE will no doubt have contacted the nomad of #NEW to discuss the situation of a failed and very public EGM. Having a company suspended simple because it can’t hold an EGM vote is not good publicity for the AIM exchange and I can’t see it happening for long.

So the FCA, LSE, Broker, BOD, Shareholders and Nomad all need a way out of wonderland. For me the majority of the impact will fall on the broker as they must have ultimate responsibility for the placing if it fails.

An open offer will not meet any of the above criteria, it will be challenged left, right and centre due to the mess of the registry. It will take too long. It will not give enough shares to the broker to meet its obligations. It is not in the best interest of the company given the current offer price.

A new placement of shares at the maximum price of the last 10-20 days, would get a passed vote by the current shareholders imho(this is needed for legal and “clean” reasons). It would put the shares in the hands of the broker and enable the various counterparties, funds etc to settle, it would allow the flip floppers to buy the shares they needed from the placing, solving that problem. The share registry would be healthy again and the company would have a large injection of cash to move forward.

The above of course would mean the broker losing out or passing that loss on to the funds or its clients. It would also mean the flip floppers potentially having to take a hit. The FCA and LSE could claim that the markets have worked themselves out, without creating a new precedent.

Anyway just a thought and lots more to happen on this share, I have no doubt. Keep a firm strategy in your mind, at the moment I am happy to hold.

#NEW update 15/05/2015

A few points about T20’s etc and how the flippers expected the placing shares to fill their short positions.

We have the EGM at 1pm on the 19^th(Tuesday), the shares should be tradable i.e settled in peoples account according to the RNS by 8am Wednesday morning.

For a start I can’t see how this would possibly happen as once approval has been given it normally takes 48 hrs for the shares to be admitted to LSE trading, but let’s ignore that. I rather think the BOD thought they could give the go-ahead to the stock exchange prior to a rubber stamping EGM. (This was a very bad thought).

So the flippers will be assuming they can close their positions (and indeed have likely arranged to have their positions covered and closed by Wed or possibly Thursday.

The T20 time is not FRIDAY (today).

However there is a big caveat in the above. The placing shares are now very unlikely to go into the accounts on Wednesday, a “No” vote is almost certain. This means the flippers have a big problem. They have an even bigger problem in that the shares are taking 5 days+ to settle atm. All of this indicates that if they want to meet their T20 obligations they need to start settling now, if they don’t every day adds to the risk. If they wait until Wed/Thur and the SP spikes on a “no” vote news then they really are buggered.

The rise start a couple of days ago imho, with the flippers starting to try and buy the stock they need. It certainly hasn’t finished.

2 Billion short fall in shares.

Now onto the important bit, the short squeeze isn’t just happening because of the flippers, its moved beyond that. Prior to the dilution announcement NEW was heavily shorted by individuals who thought that a placing was going to be needed. These shares need to be covered.

To meet demand the Market Makers will also be heavily short of shares.

To meet clients expectations of settled shares, many, many brokers will also be heavily short of shares.

All of this is an almighty mess, but one fact is inescapable everyone needs shares, if you have settled shares in your account, then your hoarding a very in demand product, keep hold of it.

The open offer and everything else is largely irrelevant. That will be news for latter following week. I do expect though an announcement that an EGM has been called to kick out these cretins, that will likely be Monday and heavily announced over the weekend.

It is not a share to sell out, in fear of bad news over the weekend as simply I can’t see any bad news that might break, but can see plenty of good news that might surface over this time.

#New world silly buggers…..

So NEW has issued the RNS that they dreaded, The Williams now hold over 30% of the company and its settled in the crest account.




RNS “On 8 May 2015, the Company received a communication from Jon Rhodri Williams, Christopher Williams and Judith Mary Williams (the "Parties") purporting to be a letter of requisition, and claiming an aggregate holding of 342,328,669 ordinary shares in the Company.…the Company is treating the Parties' requisition as invalid as the Parties have failed to satisfy the criteria of either article 89”



And then we have…todays holding RNS which states that the Williams really did have 342m shares and now had 250m…..



This seems strange either they had the shares as a holding before or they didn’t. My understanding is that they didn’t have them settled and that the 250m are settled now and the rest will settle by end of play today….RNS tomorrow then. No shares have been sold by the Williams its purely a very disingenuous and misleading, not to mention false way of reporting by the company. We don’t really expect much more from them though.



The NEW BOD knows this means an end to their existence, the only question is when and whether they go out with an ounce of grace and decency.

The blocking vote at the meeting means that the placement will NOT now happen, it really is inconceivable that the BOD will get 300m yes votes…
An EGM can now be called under Jersey Law in June to have a vote of no confidence in the BOD and to sack the lot of them…


The question is really around what happens now.

Well we have two scenario’s.



Scenario 1 is that the BOD follow through with their open offer, given that Chris would have to be stupid not to take shares at 0.05p he will certainly take up his allocation IMHO. Many of the other holders will also take their allocation leaving, if they are lucky 800m to 1bn shares for Cornhill. Will this be enough to cover all the forward sold shares from the now not to happen placing? I doubt it.




Scenario 2 is that the BOD don’t attempt the open offer, they submit to the overwhelming view of shareholders and raise the funds at a much higher price with far less dilution.  Major share squeeze occurs and the SP rises well above 1p.

There isn’t really much else that can happen, yes we might have an offer the company, yes due to a vastly incorrect share register the court might decide that no vote can be taken immediately.




However, under no circumstances, can those that forward sold their shares, close all of their shorts on time.




The rise will happen...Thanks flip floppers...

Icebergshares Quick round up on Election Day

Firstly I’ve not brought or sold any positions for a while, so If I am quiet about a share, it simply means I am busy, or there isn’t much to be said.

The UK election.

People need to pay attention to this, it will effect some shares imho. It looks like nobody will win and even a Labour-SNP or CON-LIB alliance will fall short of votes to get a majority.

This is likely to mean uncertainty, which the markets don’t like and deals which could well effect UK exploration, house building or whatever sectors your in….

Let’s start with the ultra-busy #NEW.

Its getting down to a value where even if there isn’t a short squeeze, with the money coming in NEW could be profitable cash handy shell company. Allowing for a dilution the MCAP isn’t unattractive with limited downside. This could help to derisk the upside.

A hefty warning though that a delisting for the company is possible so definitely one to only invest what you are happy to throw away.

#SAV drill results.

Although a little disappointing, I fully stand by my post on LSE.

“Blimey what a lot of info. I do wish David would spread it out a little bit.
Get the bad stuff out the way.
Zone 5 looks cr*p. I am glad they canned the drilling.
Zone 4 Diamond drilling wasn't great either, they missed the target. Yes there found evidence of VMS mineralisation, but they still need to find the actual mineralisation and that could take a fair bit of time and effort.

The western targets in Zone 4 look good from initial testing, they actually look great re gold target, although weak for copper. For me this looks to be a nice concentration of gold veins, separate to or leading to or from, the main VMS.

The market though does not value rock chip samples(those silly enough to have invested in ORE will know this). They can be very selectively taken and represented.

David needs to hit with the next ground of drilling to prevent SAV from being in danger, the trenching work, if done in enough bulk, might well be an advance to go, collect £200, if its good and it should be really.

Market won't move until we get that trenching work or economic movement on Mozambique imho, I just hope that David raises money post this work in August or September.

If I had to grade the RNS's today it would be a C.”

The gold does look promising but we need it to be AIM proof to allow the SP to recover and expand.

Overall still a nice hold, but I think I need to check with David to see if he can expand on the RNS a little.

#OXS still waiting, we still have definite silence from all involved and concerned.

We also have the usual overhyped and overpriced companies (won’t name them), but I hope folks are careful out there. Don’t get greedy, pick the safe bits and if in doubt don’t hit the button!

Aim higher......

Hope people have enjoyed the bank holiday, lots of #NEW tweets, hope it works out for folks, but also hope folks understand the longer term consequences.

I posted a blog back in March http://icebergshares.blogspot.co.uk/2015_03_01_archive.html

It was a not so veiled viewpoint of something that investors don’t think about too much.

I’ve also tweeted about the frothiness of the market at the moment. The main point I was making about this frothiness, was that the market is not behaving correctly, we are seeing very large rises and falls without too much substance. Yes this always happens on AIM but not..Repeat NOT to this extent.

For me this rings alarms bells. Rome fell due to the decadent nature of their system.

AIM is decadent.

There is far too much of a cozy relationship between nomads, companies and brokers. This impacts the market doubly through a very cozy relationship, between nomads, companies, brokers and powerful private investors and investor groups.

Add on a layer of corruption, from all of the above and we get nomads having to apologise for the rampings of CEO’s, forward selling of placements and market manipulation, to allow risk free high margin placements, the shafting of shareholders al la Afren.

Given all this, what’s happening at #NEW has been on the cards for ages.

I have no doubt that over the next few months we will see more of this, along with suspensions, CEO resignations, court action and warnings from companies.

Make no mistake fortunes will be won and lost. But most investors (notice I say most and not all), will be playing a game of Russian roulette.

As a private investor you need to make a decision, play the game, take the risks and gain the rewards. Don’t play the game and perform a level of due diligence on any investments.

So what can investors do?

Find out who the nomad, broker and advisers are.

Is the company “friendly” towards certain private investors? (this is a bad thing).

Does the company act professionally at all times?

Are leaks common?

Does the company survive on hype?

Personally, I’ve been steering clear of dodgy companies, despite favourable sentiment, for a few months now. For those wondering the boring, high growth, professional companies such as #AEG are the ones I am hinting at as good companies to invest in!

Hope whatever peeps decide works out for them.

Icebergshares #AEG Seeing the wood for the trees.

I’ve been following AEG for a few weeks now, it’s a company that I know is familiar to a few of you PI’s.

Quite simply they make products from wood. They use cheap plentiful resources in Ukraine and ship this is fast growing developing countries such as Turkey. So far so good. They have been on a steady progressive restructuring to reduce debt payments, increase margins and grow the core market.

There are two aspects that make AEG particularly attractive as an investment at its current share price.

The first of these are the phenomenal growth rate that it’s currently achieving. AEG produced 67k tons of wood chip bio fuel in 2013, this rose to 280k in 2014 and I have been told will be around 1m tons (estimate) in 2015.

Revenue is set to increase from 8.4m in 2013 to 21.5m in 2014 to an estimated 70m in 2015.

Profit is set to be round 4-5m in 2015.

Unofficial figures for 2016 indicate revenue breaching 100m with profit of 15-20m.

The second reason for wanting to invest into AEG is a particularly good deal in Canada. AEG managed to negotiate the setting up of a new company of which is owns 45% with local tribes owning the other 55%, AEG’s role is to commercialise the forests under the agreement. 250K hectares are in the agreement with 100k been the most prime commercial. This was in July 2014 and by the end of the year full commercial evaluation was undertaken and AEG went on a roadshow across the world to find potential suitors for the forestry licenses.

Three potential suitors were found willing to pay $300m for the rights to the 100,000 hectares. A formal offer is set to be made in the very near future.

Along with the current Canadian forestry deal, there are strong rumours that further tribes within Canada have approaching AEG to help new set up further multi hundred million forestry deals.

AEG has a current Market Cap of £31m currently. It’s currently a profitable, very rapidly growing, AIM company with a strong revenue stream.

I am not a chartist and don’t really put much faith in technical analyst, but its bouncing along a break out imo ready for a rise to 8-9p based purely on continued “no news” but rapid growth expectation.

News of further Canadian deals could push it to 10-12p and news of a confirmed $300m bid would push it to 15-20p.

This is purely my opinion but there is plenty of scope to buy, hold as a long term for good profit with some risk attached to a much larger potential reward. i.e  a win or big win scenario.

Icebergshares: UKOG More than it can chew.

Well I’ve been on holiday and got back to UKOG mania, firstly well done to all those that made a fortune on the sentiment rise. For those that brought in recently on the rise, I wish you the devils luck on making money, leaving with your money, or even not losing too much.

UKOG has commissioned an American company to produce a report on its oil reserves, not only has it done this based on a single drill, but also without 3D. It reported 158m of reserves per a sq mile and even felt it was able to update and come up with a figure of upto 100bn for the entire weald across Southern England.

It has been interesting to watch the media reaction to start with we had newspaper style headlines, however as the day progressed the BBC received information that questioned the massive figure and a more sceptical reporting angle was given.

http://www.bbc.co.uk/news/business-32229794

Quotes such as “CIBC strategist Jeremy Stretch says we should treat the estimates with caution. He said: "There remains a considerable divergence between estimates of reserves and the potential degree of extraction”

And let us not forget “Last year, the British Geological Survey (BGS) produced a report suggesting there were 4.4 billion barrels of oil trapped in shale rock under southern England - which would need fracking to get it out.”

So within a year based on a single drill an American company paid by a rampty ramp company came up with an estimate that’s 25 times higher than the estimate by the BGS which was based on hundreds of drills and samples.

We need to get Nutech in perspective, it’s been ramping the hell out of Shale production in the UK for a couple of years. However lets ignore that and look at the actual figures.

Nutech compares the Weald with Bakken, Wolfcamp and Bazhenov in Russia. In all of those areas TOC’s of 4% or so are the commercial minimum’s.

If we look at the UKOG figures produced by Nutech we only get 17.4m down from the 158m where the TOC is higher than 4%, so a pretty big drop then.

As mentioned in a previous blog, reports from British Universities generally support the idea that TOC’s of 10%+ are needed to support natural extraction in the Kimmeridge layer with a sweet spot of 20%+ needed.

Given an actual recovery rate of say 5% that gives us 850k per sq mile.

Now let’s play a little more…..Kimmeridge is known for good fracturing exactly as UKOG have mentioned, what they haven’t mentioned is that the fracturing tends to be heavy but with small lateral expansion, ie a fracture might extend 5-50cm, this is unlike some other sandstone and mud stone types where the fractures can extend 100’s of metres. 

This means to extract even a fraction of a sq mile, very large laterals (probably 5-10km) will need to be drilled. If UKOG get permission to drill these kinds of laterals in the populous areas around Gatwick then I am a monkey’s uncle.

The final point is the pressure. As mentioned by David in a BBC interview the weald has no pressure…..

This means flow testing will be problematic and will require industrial level permission. Any flow will likely be measured in the 10’s of barrels a day imho. With no guarantee that the hole is commercial.

This morning UKOG had an MCAP of £50m after rising up from £5m. This is a madness figure. The news released doesn’t really change anything. A tremendous amount of poor quality posting is on the forums showing a total lack of geological understanding. Personally I put a realistic mcap of around £5-8m on UKOG at the moment, this will change in Q4 depending on the success or failure of any flow test.

Well done again for those that made money on sentiment, but whenever money is made on sentiment and not on real added value 4 out of 5 investors lose money. Personally I prefer to make money on value adding news….