Author Topic: ALS.TO - Altius Minerals  (Read 1745564 times)

goldfinger

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Re: ALS.TO - Altius Minerals
« Reply #170 on: May 04, 2011, 06:57:27 PM »
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I have picked some up, I am considering adding more if this gets much cheaper. Right now I'm also holding SCP (Sprott Resource Corp) for a couple years now and these two are a sizable chunk of my exposure to resources (not counting my gold and silver).

As an anecdote: Paul Van Eeden has been very bearish for more than 3 years now and has sold most of his investments. However he has kept his position in Altius. Now I am not saying it won't get much cheaper in a commodity crash. It will. But from where? What I mean by that is: what happens if the Alderon stake gets sold soon for a good price: the amount of cash on the balance sheet will exceed current market cap by far. In a crash they can buy royalties like nobody else...


Mark Jr.

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Re: ALS.TO - Altius Minerals
« Reply #171 on: May 04, 2011, 07:13:43 PM »
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I have picked some up, I am considering adding more if this gets much cheaper. Right now I'm also holding SCP (Sprott Resource Corp) for a couple years now and these two are a sizable chunk of my exposure to resources (not counting my gold and silver).

As an anecdote: Paul Van Eeden has been very bearish for more than 3 years now and has sold most of his investments. However he has kept his position in Altius. Now I am not saying it won't get much cheaper in a commodity crash. It will. But from where? What I mean by that is: what happens if the Alderon stake gets sold soon for a good price: the amount of cash on the balance sheet will exceed current market cap by far. In a crash they can buy royalties like nobody else...


Indeed, in fact that's kind of what SCP did, they had just sold PBS Coals for a 240M profit right before the meltdown hit and they were sitting on it in cash. Their stock took a massive hit too, but they just took advantage and started putting it work.

Liberty

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Re: ALS.TO - Altius Minerals
« Reply #172 on: May 04, 2011, 07:37:27 PM »
That's partly why I like Altius and bought a good amount; if things go well, they have lots of projects that get more valuable. If things go to hell, they can buy lots of undervalued assets and/or repurchase stock. Heads they win, tail they win...
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Dazel

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Re: ALS.TO - Altius Minerals
« Reply #173 on: May 04, 2011, 07:42:19 PM »

SCP has an interesting longer term look with their farming assets and oil company but they
like ALS did not get a big return on the cash...

ALS has a greater upside because of the assets they hold...Alderon is the one they will cash in on first but you have to believe they are negotiating on the other assets as well...Their cost on the balance sheet for all projects is $4m...and Voisey NSR is $10m! That is all they have allocated to the cost of these projects....they have a huge upside..beyond Alderon.

It would be a tremendous take out target for someone to walk in take a controlling position in Alderon get the all the royalties for free..and pay yourself back with their cash...
Really if we were Leucadia and we had the cash we would be buying out the whole company...it's free...if you control it.

an aside.

Those that have not read Jeremy Grantham's new piece I suggest you do...explaining peak everything...myth posted it.

CNBC may deal in bubbles and 3 days is a long term trade! But places like China are thinking 10 and 20 years ahead. Gold, silver...peaked??I do not know. I do know that demand for iron ore will continue and at half the iron ore price today the alderon NSR is $100m...they would call that a crash if the price was half! I would take the $100m happily!
just a matter of time for Altius...The cash that has been a drag on earnings looked real good today!

Dazel.

goldfinger

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Re: ALS.TO - Altius Minerals
« Reply #174 on: May 04, 2011, 09:04:05 PM »
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Those that have not read Jeremy Grantham's new piece I suggest you do...explaining peak everything...myth posted it.

In addition you do not have a China (1.5 B inhabitants) + a Brazil + a Russia + an India + etc... building/rebuilding themselves every 30 years (even though this can be (temporarily) interrupted by severe crisis at some point in time).

MrB

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Re: ALS.TO - Altius Minerals
« Reply #175 on: May 05, 2011, 11:47:50 AM »
Wisco's  19.9% stake for $240m and their guarantee of purchase of 4m tonnes of iron ore concentrate made them about $750m profit in a little over a year! plus they have secured supply.

Dazel,
Can you break this down a bit? Is this just talk (from the co) or has cash actually been exchanged?

Thanks in advance.

Dazel

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Re: ALS.TO - Altius Minerals
« Reply #176 on: May 05, 2011, 12:01:53 PM »


If you read the posted link you will see that the 19.9% was bought for $240m...that would give you a market cap of $1.25b...on their purchase price. They were sold for $4.9 billion (below)...it is is the final stage of closing. I have never seen a company from china reveal how much they make in these types of deals in north America. They are too smart...they obviously trust the principals that have gone to Alderon..why would they not do it again when they know they have the demand in china? Alderon is literally next door but closer to  rail and other services.

dazel.
http://www.bloomberg.com/news/2011-01-11/consolidated-thompson-potash-corp-canada-equity-preview.html

MrB

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Re: ALS.TO - Altius Minerals
« Reply #177 on: May 05, 2011, 12:15:55 PM »
Read it, but it makes no mention of the $240m. What am I missing?


MrB

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Re: ALS.TO - Altius Minerals
« Reply #179 on: May 05, 2011, 02:17:47 PM »
Ok, thanks. So to circle back to my original question and let's just focus on the $240m. How much cash has exchanged hands? This was a July 2009 deal, so presumably all of it, if one is to count it as profit...No?