HIGH-GRADE NI-CU-PT-PD-ZN-CR-AU-V-TI DISCOVERIES IN THE "RING OF FIRE"
NI 43-101 Update (September 2012): 11.1 Mt @ 1.68% Ni, 0.87% Cu, 0.89 gpt Pt and 3.09 gpt Pd and 0.18 gpt Au (Proven & Probable Reserves) / 8.9 Mt @ 1.10% Ni, 1.14% Cu, 1.16 gpt Pt and 3.49 gpt Pd and 0.30 gpt Au (Inferred Resource)
Message: Perfect timing for Mick?
Here Micky micky.......March is coming fast.......
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Fund set up by former Xstrata boss Mick Davis comes up short
Former Xstrata boss Mick Davis started X2 but has yet to strike a deal
- Martin Strydom
- The Australian
- 12:00AM December 28, 2016
A fund set up by mining veteran Mick Davis to snap up bargains during the commodities downturn has spent more than £11m ($18.8m) on pay, rent and other costs over the past two years with nothing to show for it.
Three years after unveiling plans to build a “mid-tier diversified mining and metals group” and raising about $US5bn ($7bn) from private equity groups and sovereign wealth funds, X2 Resources has yet to strike a deal.
The accounts for the past two years show it has received £15.1m in advisory fees and spent £11.1m on administrative expenses. This includes £2.3m in office rent in central London.
The fund, whose nine staff received £2.1m in pay, spent £744,000 on travel and £293,000 on telephone calls, lost out to local groups when Rio Tinto offloaded its coal operations in NSW, as it refocused on iron ore and copper.
It was also in talks with BHP Billiton when it was looking to offload assets such as manganese ore, alumina, coal, nickel and lead at the end of 2014, but BHP Billiton decided to spin off the assets into a separate company, South32.
A source said it would be unwise to write off Mr Davis, who built up Xstrata into a FTSE 100 company before selling it to Glencore for $US27bn. “Deals can happen very quickly,” he said.
The fund relies on fixed advisory fees for income. These will be paid until March but after that they will be based on 1 per cent of invested capital.
The going concern entry in accounts for the year to the end of March states: “As at the date of these financial statements the fund has not yet made any investment and should it not make any investment prior to March 2017, or successfully renegotiate the fee terms of the fund, then the LLP will have no source of income at that point. Should that happen the members have assessed there will be sufficient funds to meet all liabilities as they fall due, as the business is either wound up or alternative sources of income are found.”
The downturn in commodities, in part because of a slowdown in China, has also created problems. In July it was reported that Noble Group, the troubled Asian commodities trader that was a key partner, was considered unlikely to be involved in any deals. A $US500m commitment from TPG, one of the world’s biggest private equity groups, could also lapse at the end of a three-year time limit.
When Mr Davis set up X2, the aim was to create a new Xstrata. However, an upturn in the battered sector’s fortunes has led some miners to reconsider offloading assets.
Analysts at Macquarie Research said in a note before Christmas: “We are certainly in a sweet spot for commodity prices at present, and it’s a good time to be a resource producer.”
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