Originally posted by Wilma85
I hope Spinks has a plan but isn't ready to announce it just yet. It could be a tough ask going back to the Top 20 again though rattling the can, especially with the uncertainty around the 2017 R&D refund, remembering that in a recent announcement it was stated that the ATO intended to seek repayment of the refund, which is why I brought up directors taking up a significant stake of any CR, as a show of genuine confidence of the company's prospects.
Digressing from KNL, I agree, AJM shareholders are getting screwed in their current CR. I'm astonished that 6 directors (I'm assuming they're all participating) get a ~$15.5m bite of the CR pie and thousands of ordinary shareholders can get a maximum of $15k each (up to a combined limit of $5m).
It would be nice if Directors open their wallets, but I highly doubt that, due to:
- All of them have access to 2mil shares @~0.15c (Conidi 1mil) to convert at any time, and the most obvious thing is that they will wait until either Epanko or EcoGraf deal (or both) comes through, and only then convert those options = virtually de-risked investment opportunity for themselves.
- I see the current Directors leaning more towards being conservative and that they will not invest their own money until it becomes almost risk-free...AJM Directors buying comes to mind.
- As you and most other holders here know, I am also against the exuberant wages being paid...not just here but any junior ASX listed Co, with NO cash-generating business...but it's been happening for decades and will continue to happen as long as investors like you and I continue to speculate with our money...company Directors will remain the only ones with a 100% success rate.
You know some of us, yourself included, were urging everyone to vote down the remuneration package, as IMO that was the only realistic chance to enforce some adjustment, calling for an EGM now is a waste of time IMO, because we either have a clear path forward b4 the next AGM or KNL will be no more or will be run by a different BOD.
So, I don't believe Directors will chip in, I do believe some of the Top 20 combined with some 708 holders will definitely grab some at this SP...I certainly hope there will be no SPP offer...I think the Board will aim for too much again, as most of them do, I think they'll aim for 5mil but I hope they'll one manage 1-2 mil, that should buy us more than enough time to finalize both projects.
Does anyone wonder why none of the large holders are selling? I know some will say there are not enough buyers but I can assure you the Investors I personally know are not concerned selling at a big loss and used that loss elsewhere if they have any doubt... My take:
- They (most) are happy to ride this one out as they are aware that Graphite will be in very strong demand during this decade as a minimum, they also know that Epanko is one of the most advanced projects with the strongest due diligence done on their numbers, it has a low enough number of SOI to allow for further dilution that will come for our equity portion and for delay contingencies such as this ones right now, but be contained to a low enough number which will mean the ROI will be very profitable.
- They are aware that several new mines that can produce quality flake Graphite will be needed to come into production during the next few years, just to make sure there is enough G available to feed all the mega-factories, hey also know that there is a good chance that LiB uptake will be greater/ faster than estimated, I talking for combined EV's (all Transportation Sectors - not just cars) - Storage - Cordless Devices - and the forgotten, but ever increasing traditional markets and another very underestimated sector, Expandable and speciality materials, this alone could put enormous pressure on supply.
- They are aware that Epanko is one of those mines that has realistic chances to be producing some of that upcoming super demand cycle.
- They also know that EcoGraph alone has a huge potential for some serious ROI.
For those that are not aware of this, might be a worthwhile read:
https://www.energy.senate.gov/publi...?File_id=9BAC3577-C7A4-4D6D-A5AA-33ACDB97C233
- Benchmark Mineral Intelligence is now tracking 70 lithium-ion battery mega factories under construction across four continents,
46 of which are based in China with only five currently planned for the US.
When I gave my last testimony in October 2017, the global total was at 17
- Since October 2017, planned lithium-ion battery capacity in the pipeline for the period 2019- 2028 has
risen from 289GWh to 1,549GWh (1.54TWh) in Benchmark Mineral Intelligence’s February 2019 Assessment. This expanded capacity is the equivalent of 23-24 million sedan-sized electric vehicles.
- This increasing scale will be a contributing factor to pushing lithium-ion battery production costs
below $100/kWh in 2019, Benchmark Mineral Intelligence data shows. This figure is long seen as a tipping point for the adoption of mass-market EVs.
- Those who control these critical raw materials and those who possess the manufacturing and processing know how,
will hold the balance of industrial power in the 21st century auto and energy storage industries.
Look at the increased demand for these 4 minerals, in just 4 years time, and remember those are estimates based on known battery factories coming online so far, and as Senate Testimony trying to make (warn) it as clear as possible what dangers are approaching with China being the absolute leader in Battery Production...I feel it is a safe bet that the US will not stand idle in the next few years but will hi the RED button and expedited some new Battery Plant Constructions and the absolute same will happen in Europe and then there are India and Africa...the below are estimates on currently known battery manufacturing (planed) ONLY!!...very important to consider my comments re the US, Europe, India and Africa and what that will do to the ACTUAL demand on those 4 minerals by 2025
Look at the ESTIMATED demand by 2023...only 3 years time, and then by 2028...only 8 years away...and repeating, that's without US, Europe, India and Africa, and they will be getting acutely aware of:
Those who control these critical raw materials and those who possess the manufacturing and processing know how, will hold the balance of industrial power in the 21st century auto and energy storage industries.
I am very surprised that the likes of some supposedly knowledgable Brokers/ Investment firms have managed to spruike oversupply fears, however, I acknowledge that their objective was made easier to achieve due to the fact that a lot of investors have very short term investment horizons.
Whats even more telling for G, compared to say Li & Ni is the fact that:
- US Graphite Import Dependency in 2018:
100%.
- While
lithium, cobalt and, more recently, nickel have received much of the attention and the bulk of investment in new capacity globally,
China has quietly led the way in the expanding graphite industry for the EV market.
- China also accounted for
100% of the world’s uncoated spherical graphite supply, which is the processed anode material that is used in lithium-ion batteries.
Unbelivable, but true..when US, Europe, India and Africa wake up...you wish you hold some producing miners of those 4 minerals, G seems to be that little bit extra special. And that's why I was almost convinced that a German Co would snatch up EcoGraf...but as I mentioned in previous post, they are just too slow. But the 2nd plant is almost a given (assuming 1st plant proves successful) and I don't think it will be in 2025 as per KNL presentation, if it happens it will be a lot faster.
We had a shocking year, but we were not alone...but looking forward, reality will have to be accepted sooner than later that new supply will need some time to come online and sentiment will turn --- supply/ demand economics will make sure of that.
As always - ALL IMO, and importantly, from an Investors Perspective
