I know you stated “proverbial”, but man, can’t you find a less distasteful analogy than that???
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Not only is it important to understand what is happening structurally, monetarily, but it would also be nice for the BOD to provide some color as why these transactions are taking place.
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Or it could mean more cash? And more ownership both. We don’t know at this point?
LOL - I had the same thought when I read that
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Sound logic per usual. I’m sure Auryn is tripping over themselves to give us more money and increase our ownership in Auryn. That’s exactly how things go down in the real world.
Nope, they are clearly putting out a “trial balloon” for reworking the contact for more Auryn in exchange for no cash. Could be good news for those that want to spend the next ten years in this investment. Somehow I doubt that our BOD has any idea how much equity we would be due in Auryn in exchange for $100M.
There’s always a silver lining. At least this means we might have a window of reprieve from the discussion of cash dividends and disconnects.
I was told that the NUOCO guys accepted shares in Auryn over cash as well. VERY ballsy.
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Higher ownership does not necessarily relate to less cash, and none of us will know until the bottom line is signed and the facts are made public.
The very fact that NUOCO guys accepted shares, to help facilitate early production opportunities, could actually mean more cash Auryn did not spend there and can put elsewhere.
Lets hope that’s not an appropriate usage. Anyone who hasn’t noticed the deft hand deals of the insiders may want to recheck to see if their wallet is still in pocket. Hopefully Auryn is not as willing as the former mentioned to expose themselves legally speaking.
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BB, there is NO WAY AMC is cutting a check for 100 million. Face it. Within 6 months the option agreement will be replaced by a different kind of agreement.
One of two things will happen.
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AMC will or will not go public, but they’ll manage and build the project out and MDMN will receive a percentage of the profits.
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AMC will go public and somehow they’ll amalgamate MDMN into AMC and we’ll all have shares of AMC.
I like #2 much better than #1 unless they put MDMN into a trust of some kind with very, very, very low overhead and all cash is disbursed to shareholders via a dividend. I have no desire to see #1 and have Vittal, Gary, Greg, and Letts on the BOD running a company and diluting value from shareholders. That kind of overhead is just way too expensive.
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Based upon the positive results published by AURYN, negotiations are ongoing between the Companies to consider AURYN’s outright purchase formula for the Company’s Altos de Lipangue (“ADL”) property claims at a much higher ownership…
Are they talking about a buy-out?
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“Based upon the positive results published by AURYN, negotiations are
ongoing between the Companies to consider AURYN’s outright purchase
formula for the Company’s Altos de Lipangue (“ADL”) property claims at a
much higher ownership holding that would enhance Medinah’s long-term
prospects”.
I read this as Auryn presented an offer to purchase 100% of the ADL ( leaving MDMN with no assets ) and MDMN BOD is countering with something less than 100% so MDMN can retain some interest in the long term value of the mountain.
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Wasn’t Madre de Dios the placer/alluvial properties in southern Chile?
You may be correct, then again you may not be.
All we know, is the $100 million dollar minimum CASH purchase price mentioned in the contract is still intact.
What may be or may not be negotiated to replace the existing contract is still speculation until it happens.
And all of the above, everyone’s different opinions and speculation, is a possibility.
We will have to wait and see.
Again: recall the ADL option already gives them 100% of the ADL claims in exchange for ownership in AMC and cash. Further, if MMC retained ownership in the claims we would be liable for pro-rata expenses of development and exploration, which we have no way to do. etc. The “much higher ownership” pretty clearly must refer to increasing the 15% ownership of AMC.
Look at it this way. The option was for 100 million cash and we would retain a 15% interest in AMC at that point.
AMC doesn’t want to part with 100 million cash. Nobody does in this market. So we’re renegotiating the contract. Maybe they give us 20 million cash and we get 30% interest in AMC. Or maybe it’s 5 million cash and we get 60% interest in AMC.
I have no idea on the numbers as I’m just making them up. But AMC does not want to part with cash to us…they want it going in the ground. Given early production opportunities they’re trying to entice us to look at the longer term.
To me it means no big pay day until they start paying dividends and can demonstrate that the cash flow stream has legs (i.e. lots and lots more drilling is neeed.) The market doesn’t give a crap about potential early production or great drill results.
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Those were claims that were supposed to be Fantastic! Ha! Not even worth paying the taxes on to keep them. The fact that we vacated them moves the needle a little more toward MDMN disappearing into AMC with some percentage larger than 15%. I hope that’s what happens.
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The worst sentence in the update
to consider AURYN’s outright purchase formula for the Company’s Altos de Lipangue (“ADL”) property claims at a much higher ownership holding that would enhance Medinah’s long-term prospects.
I think we all want a return and have Medinah go away
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This post by CHG nails it.
http://theminingplay.com/t/mdmn-2016-01-25-weekly-discussion/808/367
Not the direction I’d like to see us go but it may be the only direction we can go with the metals market as it is. Also, I think it’s the unfortunate consequence of having people who are gold bugs running the company.
My guess is the powers that be have already negotiated most of it and know at least the parameters and direction of path A or B. I’m hearing there’s another trip scheduled to Chile in early / mid March to put a bow on all of this.
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The very fact that they mentioned it implies as much.
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Given that Nuoco and CDCH already have their deals done, I’m assuming MDMN goes the same path. AMC won’t want to be dealing with the different entities in different ways. That’s what leads me to believe we’ll somehow be amalgamated into a AMC company on the TSX. Either that or they had to give the CDCH and NUOCO and CAREN folks shares of MDMN.
At least that’s my thinking at this point based on the information available publicly.
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