andy2, you are correct. Promises from MDMN BOD for additional meetings in March shouldn’t be interpreted as reaching an event that translates into a share price increase for us. It only means more meetings. The only hard date we have is July 31, 2017. Until we receive a statement from Auyrn with any new milestone dates, July 31, 2017, is our reality.
There goes the BID whack!
At $100m market cap where we own 50% we only get to $0.035c- not interesting!
$50m divided by 1.35bn shares is $.037c, or exactly 50% of the 7.4c option.
Current market-cap is alittle over $20m
We have expressed our opinion many, many times over the past years. Never made a difference other than defusing shareholder anxiety. Always left with a “wait and see”. Nothing ever changed on the mgmt side. I suggest the only event that will make a difference is a “fairness opinion”… a potentially legal lever to pry open the lack of transparency. I checked with a friend’s son who works for FTI Consulting:(http://www.fticonsulting.com/industries/mining)
Would shareholders be willing to contribute $$ to cover the cost? There are several Consulting groups that do this sort of thing. I don’t have any idea how much this would cost. Suggestions??
Maybe Auryn wants to use a “Fairness Opinion” as leverage to get mgmt in line. Auryn could end up with a more bankable asset with proper valuation and transparency of past bd actions.
Whatever it takes to have eyes wide open, this time with a real professional mining company
Peter
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Nice move in certain PM stocks today…that’s why you don’t put all your eggs in one basket 
I think John BE might be able to help you in that Department
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We already missed 2 cycles with JJ and his failed deals now we are entering the third cycle and no end in sight could of made s lot of bucks in the last two cycles if I hadn’t parked my money in this Pos.
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Peter, FTI is a great, global firm, but I think for our situation, a firm specializing in mining would be good. The CEO of Behre Dolbear is a friend of mine and could do the fairness opinion. My guess $50-$100k for this transactiion.
Having had some experience in corporate finance, if we leave the fairness opinion, if one is done, up to the BOD, the opinion will come back at whatever price the BOD negotiated. My advice, wait and see what the offer is, then we can all kick around the idea.
One thing I would caution, given the pm markets and very, very limited scope of exploration, a $100MM valuation may be hard to justify.
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Here is where we are from my vantage point.
AMC owns all the properties surrounding the ADL. MDMN owns the ADL. Neither one of those is going to be any good without the other. We need each other because the project isn’t worth near as much without being consolidated. 85% of the ADL is worth more than 100+ million at this point. AMC doesn’t have that kind of cash OR doesn’t want to put it into MDMN because they would rather put it into the project.
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JJ no longer has any capacity to block anything or hold anything up.
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AMC and MDMN now get to negotiate how much if any cash does AMC put into MDMN and how much of AMC does MDMN retain for 85% or more of the ADL.
Both parties are on level ground here. I don’t think either has the upper hand. With JJ out of the picture I don’t expect it will take them long to figure this out. Rumor has it AMC is going to PDAC then all the parties are heading to Chile after that. I don’t see AMC on the PDAC exhibitor list so (and it’s a forward looking rumor) so I’m not putting a very high level of confidence in it.
Given the environment I think we won’t have any earth shattering exit event until they are producing positive cash flow and have done enough drilling to demonstrate that it will last. I don’t see MDMN getting any kind of a windfall to dividend out to shareholders. Nor do I see AMC or anyone else aggressively buying a large portion of MDMN in the public market any time soon.
Once a deal is closed with AMC, our future will be dependent on the value of the property and the metals market in general. I suppose that’s not a terrible place to be in for the next few years. Anyone who wants can now buy in at the ground floor. Too bad for those of us who’ve been buying in at various floors all along the way for the last two decades. Live and learn.
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Wizard, re: PDAC, my guess is the top AMC’s guys will be there, obviously not as presenters, but all the bankers, large investors, and mining execs attend. A lot of biz is done there, so it makes sense for them to be there.
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removed by me…
Hi CHG,
Great points as always. Let’s assume scenario #1 is accuarate. Medinah gets $10 million and 40% of AMC. AMC “saves” $90 million in upfront cash and loses 25 percentage points. Like you state this gives us an implied Auryn market cap of $360 million.
I know you guys are tired of this concept involving a DISCONNECT between Medinah’s current market cap of $20 million and its post-option exercising FMV of let’s say $200 million based on the original ADL option terms. This assumes production is fairly robust and ramping up nicely.
When there is a DISCONNECT like this present YOU HAVE TO LEVER IT. IT’S FREE MONEY. With that $90 million in “savings” how much of that money would need to be spent by AMC in open market Medinah share purchases in order for AMC to INDIRECTLY recoup (“clawback”) those extra 25 percentage points given to Medinah. They would theoretically have to buy 25/40ths (62.5%) of Medinah’s shares to “claw back” those 25 percentage points. IF THE SHARE PRICE REMAINED STAGNANT AND THE MEDINAH MARKET CAP REMAINED AT $20 MILLION, THIS WOULD COST AMC ABOUT $13 MILLION SAVING THEM $77 MILLION OF THE $90 MILLION. AMC JUST “LEVERAGED” THE DISCONNECT AND GOT THOSE EXTRA 25 PERCENTAGE POINTS BACK IN AN INDIRECT FASHION. This is a huge win for AMC and even moreso for Medinah.
This company we own shares of called “Medinah” now owns 40% of the action in AMC, we just have a new cross section of shareholders with a much stronger Peruvian influence. The $360 million “implied Auryn market cap” is still there and “Medinah” and its shareholders own 40% of the action. If Medinah were to have taken that $10 million up front and bought back, demanded for delivery and cancelled those shares they would have cancelled half of their issued and outstanding shares THEORETICALLY (if the share price didn’t budge which isn’t going to happen). The percentage interest of you and I in this “New Medinah” which owns 40% of AMC will have doubled (theoretically). Our shares of future dividend distributions will also double.
All of those past negatives collectively causing the share price depression and the DISCONNECT become a net positive when Medinah and its allies gain access to cash and buy back shares. Anybody can lever the DISCONNECT whether it be Medinah itself (the ideal situation), AMC who Medinah is about to own a piece of the action in or any potential allies/investors in EITHER company. THE GOAL IS TO BUY PIECES OF THE ACTION IN WHATEVER COMPANY IS GOING TO SURVIVE AN AMALGAMATION (AMC) AND BUY IT AS CHEAPLY AS POSSIBLE WHICH IS OFTEN “INDIRECTLY” PRE-AMALGAMATION VIA THE PARTY WITH THE DISCONNECT. The number of “win-wins” that can be designed when the “currency” (share price) of one of the players is mispriced is endless. It ends up being an ARBITRAGE.
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Is there really a “DISCONNECT” given the entire sector is having the same thing? One shareholder told me yesterday about other companies that are even worse off then MDMN and have better prospects where he’d put his money if he could. Perhaps our value right now is appropriate given the environment and stage of development. As mdmnholder suggested, maybe we don’t want a “fairness opinion”.
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We just knew that damn mountain had so much potential…woulda,coulda,shoulda
Hi Wiz,
Yes there really is a DISCONNECT even though the sector stinks and the size of the DISCONNECT is enhanced by the sector being in the toilet. But that is a good thing ONLY if you have cash and can buy back shares. The problem with most of the juniors is not enough cash to fund exploration or even pay the taxes on your properties.
The average junior faces a lousy mining market with not much interest being generated by outside investors and so many good investment opportunities for those investors that any one junior might only get a trickle worth of investment flow. You don’t want to PROMOTE your way out of one of these markets.
When you have cash in hand, part of you wants blood flowing in the streets in the overall sector. This way you can buy back and cancel THAT MANY MORE SHARES with a fixed amount of money. You actually want shareholde unrest, a few Ulanders in the rear view mirror, some “done, done, done” events, operation Bermuda Short, characters like JJ, corrupt markets, etc. These things depress the share price and therefore add to the DISCONNECT. This adds to the LEVERAGE available if you stumble upon some cash.
Medinah is the ULTIMATE candidate for a massive DISCONNECT. How many times have we said that Murphy struck yet again. The only good thing about past DILUTION is that it is REVERSIBLE if you gain access to cash, you really do have the goods and a massive DISCONNECT is present.
The other good thing here is that we gain access to a BENCHMARK that we’ve never had. A fairness opinion rendered the verdict that a 25% stake in AMC is worth $90 million i.e. the whole enchilada is worth $360 million AT THIS STAGE OF DEVELOPMENT before production commences and ramps up. There would also be a “control premium” attached to any 40% stake. Are there people in the wings desirous of all or part of that 40% stake? I would suggest it likely and that all of these moves are being dictated by some other entity.
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I thought we have billionaires as Partners? Now they can’t even raise $100 million to exercise so we can all leave this nightmare??
Didn’t this happen with our other past deals no money could be raised and it was all about shares being shuffled sround
Cash is KING!
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