FMS 0.55% 91.5¢ flinders mines limited

WHY would any shareholder want to vote FOR this deal??

  1. 7,722 Posts.
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    (This is just my personal opinion. Shareholders should get their own advice)

    It IS SPIN we are being subjected to in my personal opinion.

    There are many very basic flaws with this deal.

    - No Certainty.

    - No payment upfront. In fact no payment whatsoever for probably 12 yrs at least (if we are lucky)

    - No valuation or numbers on the value of the 40% shareholding we are to get, IF we vote for this deal. It is the value of that 40% which is the very reason why FMS is proposing this deal. How can we possibly agree to a deal, when we don't know what the value or returns of the 40% shareholding may be?

    - Conflicts of Interest - there are a multitude of potential conflicts of interest, any one of which is a deal breaker. We FMS minorities will have zero say in anything. FMS is controlled by Todd. Todd is the beneficiary of 94% of the revenue which BBIG will suck out of the BBIG project. Todd/BBIG and their Chinese partners will be on both sides of the deal. The BBIG partners will have an interest in BBIG project, some will also be actual customers of PIOP ore, some will also be funders of the Project and mine debt, and some will be our "fellow shareholders" in PIOP Mineco.  Guess who will have majority control of PIOP Mineco??

    - Security - FMS' PIOP Mine will be taken as security for ALL the BBIG Project debt. If BBIG project fails, or BBIG or its partners default, then PIOP mine may be lost to FMS forever. Our asset PIOP, is secured for BBIG debt, yet FMS has no economic interest in BBIG Project!

    - guess who controls all the cash which comes from the sales of PIOP ore?? Yep, BBIG.
    BBIG handles all the sales, and the cash which is generated from the sales of PIOP ore goes into a bank account controlled by BBIG.
    BBIG take out the cash it believes it is owed, and the balance supposedly goes up to PIOP Mineco.
    If minority shareholders have a beef about how that cash is handled, they would need to get FMS to complain (FMS being 56% controlled by Todd), then FMS would need to get PIOP Mineco to complain (PIOP Mineco controlled by BBIG and its partners in that very BBIG Project). Good luck with that one!

    - guess who has already executed all the Offtake agreements which we will rely upon for our supposed return?? Yep, BBIG. FMS and its minority shareholders will be lucky enough to have PIOP Mineco takeover those Offtake MOUs which BBIG has already executed with customers, some of whom will partner BBIG in their Project, and some of whom will be Funders of the Project debt, and some of whom will be equity partners of PIOP Mineco, and some of whom will partner BBIG in the management of PIOP mine, and some of whom will construct the mine. Nope, nuthin to see here folks!

    We Do not have to accept the SPIN.
    I will Only be relying on the written documentation we have been provided with from independent experts.

    There is plenty, plenty more issues.

    Just because this is the only deal offered, does not make it a good deal, and does not mean we have to agree with it.

    When the BBIG reps stated to FMS that this is the best deal we will get, The FMS directors simply should have got up from the table and walked away.
    IMHO, we would have been better-off with a manageable debt of $3m payable in 2022, than a triple sized debt of $10m now, with the imminent R/I which will see Todd increase its shareholding in FMS yet again, at a bargain basement price.

    You can change your vote any time up to 10.00am WST on Sunday 1 March 2020.
    Just go to www.investorvote.com.au  and make sure you direct the Chairman how you want to vote.
    Last edited by jake0002: 25/02/20
 
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