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I was just going to post something similar.
I've heard Colin say they can turn down the first two offerers and send if for a third valuation, but that's all, I think that would be the sale price.
Say "no" three times and XTR can do whatever they want doesn't make sense.
I can't believe the buy-back clause wouldn't compel Xtract to sell based on the independent valuation if AA wanted it back. But, as I said previously, the buy-back clause only applies to 80% of one licence. Xtract can refuse to sell the rest and that would make it a lot less likely that AA would want it. So AA need to offer a fair price for the lot or it is likely the lot will end up for sale on the open market.
All IMHO.
I find this confusing. The argument seems to be that AA should be able to compel XTR to sell after eventually going to an independent abitur but that XTR ultimately hold all the cards do to the 80 % clause where they can name their price!
https://www.youtube.com/watch?v=PDv0OEknsLk
17min 15 secs in
CB quote
"It would be independently assessed by a consulting company. And of course Anglo don’t have to accept that assessment, neither do we"
"It would be independently assessed by a consulting company. And of course Anglo don’t have to accept that assessment, neither do we"
That would be an indefinite freeze situation which absolutely would not suit XTR shareholders. This idea that somehow we hold all the cards over AA is pure fantasy. If an independent valuation is arrived at, then of course Colin can say no, but it means we are trapped with no way of unleashing shareholder value. If AA put in an offer that aligns with the independant figure then we have no choice but to accept realistically. We will see I believe somewhere between 10 - 20 p. The sooner we can get that and move on the better for everyone concerned.
" If an independent valuation is arrived at, then of course Colin can say no, but it means we are trapped with no way of unleashing shareholder value"
My understanding, maybe wrongly, is that we could then go to the open market?
Andrew - I know that CB said we didn't have to accept the valuation but I don't believe there isn't a point at which any 'appeal process' comes to an end and Xtract are compelled to sell if AA want it back. There is no point in having a buy-back clause otherwise.
The agreement gives AA first right of refusal to buy back, not a right to. The comment from Colin bird previously that, “they don’t have to accept that 3rd party valuation.” could mean that the 3rd party valuation will not necessarily be the final sale price but will provide common ground to bring negotiations within a range.
Generally I think the agreement is fairly watertight and prevents Xtract from simply turning down any offers made for the sake of hoping another buyer wants it for more. Further previous comments from CB in an early podcast would support that, “the agreement is legally binding and the only way xtract can be free from it is if AA have the decency to release us from it.” ( possibly not exact words but very much along those lines. )
Certainly agree with stevem on the 20% and other tenements.
It’s safe to say that if AA want it, then Xtract will sell it.
Steve
You maybe right, but I can only quote what CB has said. If we have to sell to AA after an "appeal process" then we can't reject the independent valuation. If so, I am surprised CB was so unequivocal in that interview, and he said the same thing in another.
My, possibly wrong and naive understanding of this is that if AA/ Xtract can't agree a price then it goes to an independent valuation. Either party can still reject the valuation and if so then we can sell on open market.
The buy-back gives AA first refusal, not option of compulsory purchase.
I accept that maybe wrong but it seems to align with what CB said in that interview
Little wing
I would have thought that before CB knocked back a final offer from AA that he would have already tester the market to assess interest from other parties. It would surely be foolish of him to reject AA's offer without knowing for certain that there would be other interested parties willing to offer more.
I would also agree that the 20% belonging to XTR would focus AA's minds.
Thanks all for your replies. An interesting discussion for sure. Guess we'll have to wait and see and hope it's all irrelevant when AA give us what we want :)
Knowing wether there are other interested parties is one thing, but is very unlikely any of those other parties could be in a position to place any value on BR without seeing all of the data. That will simply not happen, AA have first refusal so would want to have sole access to all data before any other interest parties get access to it as it would cause a type of conflict of interest.
The conflict of interest would be on Xtracts part as they could potentially benefit financially from interference from any other interested party offer, outside the terms of the buy back agreement that is between xtract and AA
I hope you are kidding
10-15p a share would be a dream.
When you look at the world economy. And the record of Colin Bird on AIM. This would be a first that investors are actually making money from a Colin Bird business.
Take the money and run. Especially if its anywhere close to 15.
A quick reminder that will perhaps change your mind about selling to AA:
The record of Colin Bird and his AIM 'businesses' (I use 'business' in the lightest sense)
Time he became CEO of BZT- SP 0.5….now 0.07
Time he became CEO of XTR- SP 10...now 3.3
Time he became CEO of Galileo 7.38...now 1.3
Meanwhile ££££ squeeze out of these companies while PIs get decimated by the very placings that raise money to pay his salaries.