This has the potential to go alot higher than the 3p I`ve just bought 300,000 I will give more info when out of meeting at 2. It is in partnership with some very big players and was hugely over subscribed.

I`ve put my money where my mouth is.......and my head on the block.

Gud luck today.

From advfn Excellent point


richgit - 24 Sep'06 - 21:45 - 1444 of 1445


The only way to ever achieve multi-baggers is to accumulate stock as cheaply
as you can.and never lose sight of the fact that the very reason you are getting cheap stock is because the masses dont agree with you.
Thus there is no point in taking a contrarian position and then looking for agreement from others.

The more that people find reasons not to hold a stock like AIMR is a sure sign
I am on winner and will get more stock cheaper,and the gains will be progressively bigger.Eventually so many will want to buy the stocks they shunned,especially those stocks where the potential-and assets-are glaringly showing their undervaluation.

My views are always on a longer term investment,though longer is progressively
getting shorter with AIMR.

any idea why this has taken a beating the last couple of days?

Strange things usually happen from sept to dec in the stock market. even though this little fish is about to become a producer, those stupid investors or gamblers are selling it. same for GTL, but has been huge buying in GTL today. I think the sp will start rising seriously once the production is near or at least in February as it is the case usually for most sp.

Zinc Rises a Fourth Straight Day; Supply Growth May Lag Demand

By Chia-Peck Wong

Oct. 10 (Bloomberg) -- Zinc rose for the fourth straight day in London on forecasts that supply may not grow quickly enough to meet rising demand from steelmakers.

Prices of the metal, used to galvanize steel, have almost doubled this year after inventories fell 66 percent as zinc miners didn't increase production fast enough.

``It's quite possible we will see even higher prices in the short term,'' Stephen Briggs, analyst at Societe Generale, one of 11 companies that trade on the floor of the London Metal Exchange, said in a presentation today.

Zinc for delivery in three months rose $20, or 0.6 percent, to $3,670 a metric ton at 1:22 p.m. in London. Prices have gained 11 percent since Oct. 4.

Stockpiles of the metal fell for the 11th straight day to 133,475 tons, the exchange said today in a daily report. Global supply of refined zinc is likely to lag behind consumption by 420,000 tons this year, Briggs said.

Supply will continue to remain short of demand next year, Merrill Lynch & Co. analyst Francisco Blanch said in a report dated yesterday.

Jmacro
excellent post. keep\it up and best luck

georgetrio,

People are selling AIMR becaue the financing is not complete, and if they do it at a lower level, then they will be able to buy at around the same price, and some of the risk will have gone.

I know people that are waiting to study the financing proposals before making a decision.

yes, a bit early stage and as always these small cap weaknesses is the finance but i have faith that all will come good at the end. fingers x. sometimes it must get worse before getting better. i bought it at different levels and i did sell some that are in profit but will be buying more.

Perkoa financing arrangements out on ASX.

Now on RNS. Summary as follows:

AIM RESOURCES LTD

18 October 2006

PERKOA FINANCING ARRANGEMENTS & MINE OPTIMISATION

HIGHLIGHTS

AIM Resources fast tracks high-grade Perkoa zinc mine development
Perkoa project funding package announced.
Initial zinc ore mining anticipated in mid-2007.
Optimisation of Perkoa mine plan brings ore production forward.

SUMMARY

AIM Resources announces financing arrangements as follows:

Standard Bank Plc mandated to provide project finance facilities totaling
US$90 million;
Cartesian Capital mandated to co-ordinate US$35 million convertible note
issue; and
Seymour Pierce to co-ordinate a US$20 million share issue.

Project optimisation accelerates development and production timetable through:

Mine development plan and processing plant design optimisation;
Revised mine development plan enables first ore to be mined sooner via a
larger decline;
Capital expenditure estimate revised to US$135 million (now includes
contingency and mining contractor costs);
Estimated 2008 production gross revenue of US$212m at current zinc price
of approx. US$3700/t; and
Perkoa in ground metal value at current zinc price of approx. US$3700/t
is over US$3.3 billion.

The revised mining plan, utilizing a larger decline and larger capacity
equipment has reduced the pre-production period by approximately 12 months.
Commissioning of the processing plant is scheduled for early 2008.
AIM Resources Managing Director, Marc Flory commented that:

'The increased costs associated with this accelerated development schedule are
more than offset by the project delivering well ahead of the previous schedule
and delivering concentrate into an anticipated period of strong zinc prices.
Cash flow is brought forward, capturing significant value for shareholders'

Development on site at Perkoa has progressed, with excavation work commencing on
the box cut for the decline development expected to start in late November 2006.

jmacroesus -

Thanks for posting that.

So they are raising $20 million via equity, so another 225 million shares approx will be issued then, depending upon the prie they will be issued at of course.

If they issue at 5p, it will be 225 million, but if they discount to, say, 4p, it would increase to 277 million approx.

The amount being raised in shares/convertible notes is US$55m - about the same as the Lonsec analysis suggested would be raised in shares. The dilution will depend on the issue price and conversion terms but could be less than in the Lonsec forecast even though more capital is being raised. Because of the earlier start the forecast net revenue figure for 2008 based on a zinc price of US$3700/t is A$283m compared with A$14m (based on zinc at US$2900/t) - should have a significant impact on the NPV.

jmacroesus,

We'll see, i am waiting for the terms of the financing first, i want to see exactly how much paper is being issued, and at what price.

I prefer to use more conservative zinc prices personally, a higher figure would be a bonus at the time, but the world economy may have turned by then, and ZN could be down in price, we shall have to see.

In my experience, EVERY mine experiences problems and delays, so the forecast net revenue may be difficult to achieve in practice, IMO.

Andy,
There could well be some slippage but the accelerated production combined with high zinc prices should revise upwards earlier forecasts. Believe that because of the current production shortfall zinc prices may rise still further next year so the use of the current price for 2008 may not be all that unrealistic.

jmacroesus -

You may well be right, but I believe that like high oil prices, the world economy cannot bear much higher commodity prices, so even if the LME zinc stocks run out, (and they could do so by just after Xmas at the current rate!), there is an upper limit to how high the price can go before world consumption would slow due to high cost.

Such a slowdown may well cause a recession IMO, so that is why I am wary of assuming high commodity prices will continue.

US housing is already in recession, it remains to be seen what effect that will have long term. The average US house uses considerable amounts of CU for example, and LME CU stocks are very low currently.

Once the finaning details are released we will be in a better position to judge IMO, just a question of waiting. I happen to know raising cash in the city is tough currently, so they may have to dilute at a lower price than they would like, we shall see.

OK, but remember that about half of the zinc produced is used for galvanising steel, where it's cost is relatively marginal. The market reaction to yesterday's announcement has been positive so far which should help with the issue/conversion price.

jmacroesus -

If the LME stocks of Zinc run out, then we have an interesting situation!

I am sure they are trying to run up the price to minimise dilution, but if they issue at a lower price ( and I think that's a good possibility) then the price should retrace somewhat, IMO.

It's all about waiting for the finer details, and I don't mind missing a few points to reduce risk.

Placement on ASX

jm,

Yes, well spotted, 30 million shares @ A$0.12.

I make that around 5p, any thoughts?

Be interesting to know when the issue price was agreed.
Here's the RNS version (several hours later....)

AIM RESOURCES LTD

20 October 2006

AIM RESOURCES RAISES A$3.6 MILLION FROM INVESTORS

The directors are pleased to advise that they have placed, to clients of
Paradigm Capital Pty Ltd, a total of 30,000,000 fully paid ordinary shares at an
issue price of A$0.12 per share to raise AUD$3.6 million (circa 1.45 million)
('Placement Shares').

The Placement Shares will be allotted and issued to applicants following receipt
and clearance of their subscription monies pursuant to the Company's 15%
facility.

Application will be made for the Placement Shares to be admitted to trading on
AIM and dealings are expected to commence on or around 26 October 2006.

Zinc Advances to Highest Ever in London on Production Shortfall

By Chanyaporn Chanjaroen

Oct. 25 (Bloomberg) -- Zinc climbed to a record in London on speculation that demand for the metal used to galvanize steel will keep outpacing supply. Lead also rose to its highest ever.

Inventory tracked buy the London Metal Exchange dropped 1.5 percent to 115,650 metric tons, a 15-year low, the LME said in a daily report today. Production will lag behind demand by 420,000 tons this year, according to Societe Generale.

``The market continues to tighten and we don't see it easing until the middle of next year,'' Giles Lloyd, a London- based analyst at consulting company CRU said by phone.

Zinc for delivery in three months on the LME jumped $160, or 2.9 percent, to $4,060 a ton as of 5:30 p.m. London time. It earlier rose as much as $240, or 6.2 percent, to $4,140, beating the previous record set on Oct. 17 by $120.

The dark gray metal has more than doubled in the past year on soaring demand from China, the world's largest consumer. Global use will increase by 3.9 percent to 11.1 million tons this year, and by 2.6 percent to 11.4 million tons in 2007, the International Lead and Zinc Study Group said Oct. 9.

Other metals, including copper, nickel and lead, are also forecast to experience production shortfalls this year. Michael Lewis, head of commodities research in London at Deutsche Bank AG, Germany's largest bank, said in an interview he's more bullish on lead and zinc, whose stockpiles continue to decline.

Minews Story
Date: October 26, 2006
AIM Resources Going Full Steam On Perkoa Zinc Project.

By Rob Davies

High and rising metal prices provide increasing incentives for miners to fast track development of new mines in order to lock in additional revenue that may not be available in a few years time. That is what the market is all about and AIM Resources provides a perfect demonstration. Scott Reid, Executive Director, described how this Australian company, which is also listed on AIM, was fortunate enough to acquire the Perkoa zinc property in Burkina Faso from BHP Billiton in January 2005 for a US$1million when the zinc price was about US$1,100/ tonne. Its subsequent massive run has seen the metal triple in price transforming the economics of this high grade, but small deposit. A mine with a reserve of 6.3 million tonnes was never going to make a difference to a company the size of BHP Billiton even if the grade is 14.5% zinc.

But it has made a difference to AIM Resources. A year ago the shares were just over 2p and today they are trading at 6.25p having been as high as 8.4p. Even at todays valuation the market is only valuing AIM at 39million but serious funding is now required to build the mine and put it into production. In fact because the company intends to fast track construction capital costs will increase to US$135million although that means that the mine can be in production by the middle of 2007, twelve months ahead of the previous schedule. This has been achieved by opting for larger equipment and going for a deeper box cut and larger decline eliminating the need for a shaft. Consequently cash flow starts a year earlier with commensurate benefits to the shareholders.

In the original plan Scott said production was due to start in January 2009, but under the new one the processing plant will be up and running by the end of the first quarter of 2008. Scott explains that the net present value of Perkoa on the initial plan was US$148million based on a flat zinc price of US$1,815 a tonne. When the exercise was repeated in March this year using a zinc price of US$3,300 a tonne the NPV rose to US$405million. The most recent calculation, using the accelerated construction programme, would yield an even higher number although it has not been released yet.

To fund this activity AIM has said it will raise US$20million in equity through Seymour Pierce, has mandated Standard Bank to raise US$90million of project finance and asked Cartesian Capital to raise US$35million through a convertible loan issue. Scott reports that the frameworks of these agreements are in place and all parties are now doing due diligence; crossing ts and dotting is. Asked whether AIM would be seeking, or if the banks have asked, to lock in current zinc prices Scott said that it would be sensible to hedge part of the production but that the company also wanted to leave some upside.

Burkina Faso is a landlocked country and has not got great infrastructure but the mine only lies 30 kilometres from a railway line with a daily service to the coast so exporting concentrate will not be too difficult. Scott reports that the company has a good relationship with the Government which has a modern and good mining code and AIM is not expecting any difficulties on that side.

Minesites last question to Scott concerned valuation. Like most Directors he feels his companys stock is undervalued, and the impending equity issue is one clear reason for that. Nevertheless, it is possible to look round the market and see a number of companies, like AIM, that have good projects moving towards production on the basis of sound economics which have lower valuations than some explorers. However, as Scott says, the market is never wrong. It just gets there in its own time, but the waiting period can be frustrating.