Sirius Minerals Live Discussion

Ripley94 26 Jan 2020

Tipped today as a speculative buy SXX… XXXXX Many comments of late from Motley. … 2 numbers that worry me about the future of the Sirius Minerals share price Jonathan Smith | Tuesday, 21st January, 2020 | More on: SXX Woman calculating figures next to a laptopImage source: Getty Images. When you’re invested (both literally and emotionally) in a stock, it can sometimes be hard to take a step back and objectively review the position you’re in. Sure, I believe everything I invest in should go up in value, but it doesn’t always happen. It’s very important to monitor the positions you have when they’re loss-making and assess whether you should cut your losses or hold on to the shares with the thinking that future losses should be minimal. To that end, Sirius Minerals (LSE: SXX) has been heading lower over the past year. So when we look objectively at some numbers, what can we conclude about the future? Price-to-book ratio Sirius currently has a price-to-book (P/B) ratio of 0.26. What does this mean? Well it’s a ratio showing the premium or discount at which the company is trading in relation to the intrinsic value within the business. The book value measures what the firm is actually worth (in essence a net asset figure). If the P/B ratio is 1, then the company’s shares trade at exactly what the business is physically worth. If the ratio was 2, this would show that investors view the company as worth double what the actual value of the business is, usually due to future potential for profit or general optimism about the business. On the flip side, if the ratio was 0.5, then the share price value is half that of what the business is worth. How is this possible? Well investors may be pessimistic about the future of the company, or they may feel that the assets the business has are not actually that valuable. For Sirius, it has a low P/B ratio and a falling share price, showing that even though it looks cheap on paper in comparison to its book value, investors still don’t want to own it. For me this is worrying. Anglo American offer price In early January, we saw a rally in the share price due to news that Anglo American is potentially looking to table a bid. On Friday, the share price closed at 5.4p. The offer price being mooted is 5.5p. Here we have another number that worries me as a potential investor. If Anglo American had actually come up with a bid and invested at 5.5p, what potential is there for a strong share price rally if Sirius already trades close to the offer price? Anglo American will still need to invest a large amount of money (I’ve seen articles quoting up to $3bn) in order to keep the project going over the next few years in order to try to generate profitability. Therefore, the 5.5p price seems fair value at the moment, and does so for the foreseeable future, until the investment kicks in and starts to yield results. Overall, neither the P/B ratio nor the mooted offer price from Anglo American fill me with optimism that the Sirius share price is going to move higher any time soon. Yes, longer-term investors could see this as a value play, but for me I would look elsewhere for opportunities, with some good ones mentioned here.

Ripley94 22 Jan 2020

Tipped today as a speculative buy SXX… XXXX Hobsons choice. Sirius Minerals faces liquidation within weeks if shareholders snub Anglo American, says chairman Anglo American today confirmed its formal 5.5p or £404.9mln takeover offer, and it was recommended by the Sirius board. Sirius Minerals PLC - Sirius Minerals faces liquidation within weeks if shareholders snub Anglo American, says chairman Money pit: many shareholders will realise significant investment losses as Anglo’s cash takeover offer goes through Sirius Minerals PLC (LON:SXX) chairman Russell Scrimshaw has warned that the company will fall into administration or liquidation within weeks, if a recommended takeover offer from Anglo American plc (LON:AAL) is snubbed by shareholders. Anglo American this morning confirmed it had now made a formal offer to acquire Sirius, priced at 5.5p per share, and, the offer has been recommended by the Sirius board. The deal values Sirius at just over £400mln and it will now go to a shareholder vote at a general meeting. It comes after Sirius’s project financing collapsed and the company launched a strategic review to explore its options. READ: Anglo American confirms formal Sirius Minerals takeover offer Significantly, in today’s accompanying comments, Scrimshaw revealed that Sirius’s efforts to attract alternative financing and/or new partners for the project had failed. “Going into the strategic review the Sirius Board’s strong preference was a solution that allowed current shareholders to participate as fully as possible in the future development of the project,” Scrimshaw said. “Following the strategic review process it is clear that no such options are currently available to us and in that context Anglo American’s offer is the only feasible option.” "We also recognise the returns that this offer would represent are not what either our shareholders or the Sirius Board had previously hoped for.” He added: “We now face a stark choice. If the acquisition is not approved by shareholders and does not complete there is a high probability that the business could be placed into administration or liquidation within weeks thereafter. “This outcome would most likely result in shareholders losing all of their investment, as well as put the future of the entire project, and its associated benefits for the local area and the UK, at risk.” He concluded: “This is the context in which your board must assess the offer for your company.” Quick facts: Sirius Minerals PLC

devonplay 21 Jan 2020

Sirius icebilly: Polygon Global Partners LLP Hedge fund, they’ve also been short and held the bonds. They specialise in high alpha, high convictions positions. Your guess is as good as anyone elses, but unless they turbo charge their buying looks likes it’s a done deal. They could of course be interested in confounding AAL’s bid, but that doesn’t mean it’s a guaranteed rescue bid. They have the sophistication to play any hand, including pre-pack out of administration. You can’t apply the same narrative to them as yourself, they can make money where you can’t. To be honest, they’ve probably already made a killing off their short positions and bonds…now they are back for a final drink from the cup… They do get involved in medium term, event driven opportunities, but are they going to provide billions of long term capital? I don’t think so. Should you take comfort from their holding? Maybe, if you can ignore the fact they’ve already participated in every other form of the company’s capital, including being short in it. What it is a sign of is the unsuitability of Sirius for private investors who can’t afford to take loses on their entire capital. If you aren’t already exposed to SXX I’d trying running in the other direction. Best way of preserving your capital.

icebilly 21 Jan 2020

Sirius Been out all afternoon, and now seen the RNS from 12.22. Who are Polygon Global Partners LLP? Where did they come from. They are suddenly Sirius’s largest shareholder at 6.992%. They must be scooping up all those sells, but why?

freedom-thirty5 21 Jan 2020

Sirius icebilly: This cheap buy out still seems crazy to me. Even most of the investment funds now stand to lost £ Millions and the largest shareholders Jupiter, Pelham,Qatar and Citiogroup lost a few Billion. It’ll be interesting to see whether or not Fraser stays on at YP. Also, there have been a lot of cushy deals with share options over the years with mambers of the board. I’ll be interesting to see what happens with any outstanding and whether they get any AA options dished out to them.

icebilly 21 Jan 2020

Sirius Yes, found and read original RNS from yesterday morning. Russell Scrimshaw did confirm these talks happened in Dec and Jan. He said it failed due to timing. I read Reuters . Thanks BB.

icebilly 20 Jan 2020

Sirius Well, there we are, if this item as reported on another chat site is true. I would say “very shafted by inadequate BOD.” In December 2019, Sirius received a non-binding term sheet from the consortium to form the basis of a US$680 million funding package to cover the initial scope of work. On 9 January 2020, Sirius received a revised non-binding term sheet from the consortium. The Sirius Board reviewed the proposed terms and conditions, together with its advisers, and concluded that the consortium’s conditions and the time it would take to meet such conditions were such that there is a very material risk that the overall funding package would not be implementable by the end of March 2020.

icebilly 20 Jan 2020

Sirius Some more info from AAL RNS site Sirius Minerals itself said its directors consider the acquisition to be “fair and reasonable”, and have recommended that shareholders vote in approval of the offer. The offer is conditional on no fewer than 75% of Sirius shareholders voting in favour of the acquisition at an upcoming general and court meeting, as well as being sanctioned by the High Court of Justice in England & Wales. Anglo American said it expects the acquisition to be completed by the end of March. “Anglo American’s recommended offer provides greater certainty for Sirius’ shareholders, employees and wider stakeholders, while bringing the prospects for the development of this potential tier 1 project closer to reality,” said Anglo American Chief Executive Officer Mark Cutifani

icebilly 20 Jan 2020

Sirius This cheap buy out still seems crazy to me. Even most of the investment funds now stand to lost £ Millions and the largest shareholders Jupiter, Pelham,Qatar and Citiogroup lost a few Billion. When some sort of joint funding would reward them for many years to come in the Billions. Crazy for one company to get Sirius on the cheap. IMHO. IB.

freedom-thirty5 20 Jan 2020

Sirius …and boom goes the dynamite.

picstIoup 20 Jan 2020

Sirius Sad for the shareholders, many of who were first timers who over-extended themselves, but good for the area and the country that the project will go ahead now that the grown-ups have taken over.

icebilly 20 Jan 2020

Sirius IT’S OFFICIAL. ANGLO BID 5.5p FOR SIRIUS. (Reuters) - Anglo American (AAL.L) on Monday agreed to buy Sirius Minerals (SXX.L) for 404.9 million pounds ($526.2 million) in cash, marking the global miner’s return to fertilizer and throwing a lifeline to the struggling Sirius. Sirius shareholders will receive 5.50 pence per share in cash, a 34.1% premium to the closing price on Jan. 7, which was the day before Anglo American said it was in talks to buy the fertilizer company. Shares of Sirius Minerals were 1.9% higher, while Anglo shares up 0.4% in the early trading. “We now face a stark choice. If the acquisition is not approved by shareholders and does not complete there is a high probability that the business could be placed into administration or liquidation within weeks thereafter,” Sirius Chairman Russell Scrimshaw said. The potential deal is also expected to save hundreds of jobs in northern England, where the lack of opportunities was an issue in the general election that returned Prime Minister Boris Johnson’s government to power. Scrimshaw said if the deal falls apart it would most likely result in shareholders losing all of their investments putting the future of the entire project and its associated benefits for the UK, at risk. The acquisition will also see Anglo American expanding its portfolio back into fertilisers after it sold its remaining fertiliser project in Brazil in 2016 when it was recovering from a commodity market crash. a sad day for all investors who bought at 22p and other higher values. IMHO. IB.

jackdawsson 17 Jan 2020

OT Comp Winner: Jack Dawsson frog_in_a_tree: To save Jack the embarrassment of having to declare himself the winner of Q2 Week 1, I will do the honours, a little bit ahead of time to pre-empt. Well done Jack! This week no one could excel you in your pessimism and even you were not quite pessimistic enough to match the plunge in the BARC share price. To think I had been tempted to take a punt on BARC recently! Hi Fiat, Thanks for the generous comment. Excellent link, too. A fine performance of Hallellujah chorus from Handel’s Messiah. Indeed, also well done to Lady Jennifer & SBK on close podiums. I was a penny away from UT 175.24, but still trailing well behind you & Ole Devil in the main event. So plenty more luck required ahead. I imagine these guys would’ve blown a few minds back in 1955. I’m a fan. Love the band, drumming included. Fair to say that while groups like The Rolling Stones would’ve still existed & done great things, their first few albums might have sounded quite different without the obvious influence of guys like Bo Diddley. Enjoy an early live performance. May all have a VG w/end!

Lady_Jennifer 17 Jan 2020

OT Comp Winner: Jack Dawsson I must admit to feeling a little disconcerted with Bunsy’s “nose right up [my]backside” but perhaps if the market hadn’t got the last two weeks the wrong way round… It should have been second, first rather than first, second … things may have been a little different?? It’s a strange quirk of iii’s system, but it is better to upload videos rather than link to them…

frog_in_a_tree 17 Jan 2020

OT Comp Winner: Jack Dawsson To save Jack the embarrassment of having to declare himself the winner of Q2 Week 1, I will do the honours, a little bit ahead of time to pre-empt. Well done Jack! This week no one could excel you in your pessimism this week and even you were not quite pessimistic enough to match the plunge in the BARC share price. To think I had been tempted to take a punt on BARC recently! Following Jack, but quite a way behind due to excessive optimism, was Lady Jennifer who bagged 18 points for second prize so well done to her. Ever ever Sir Buns had his nose right up her backside but she was safe enough due to a cordon sanitaire of 0.4%. As for Olé and myself we still head the table by a good margin and we are in no danger of being overtaken anytime soon. Jack hasn’t had too many wins of late so let us all give praise! [link]