Jul. 9, 2014, 10:36 AM
- Apollo Global Management (APO -3%) is adding to its holdings of Molycorp (MCP -8.2%) bonds, positioning the investment firm to control MCP in case it seeks to restructure its $1.5B of debt, Bloomberg reports.
- APO bought $8.5M of MCP’s $230M of 3.25% convertible notes due 2016 in the March quarter and has since added to that amount, according to the report; as of March 31, APO held at least 22% of that class of securities.
- APO is betting holders of the convertible notes won’t receive a full recovery in a default, putting those lenders in control of a restructuring and in line to take over the company’s equity, the report says.
- The attempt at a backdoor takeover puts added pressure on MCP to find a solution to its cash burn or risk being taken over by APO and other bond holders, raising the potential for a dilutive event within weeks.
Jul. 2, 2014, 12:56 PM
Jul. 2, 2014, 9:15 AM
Jul. 2, 2014, 8:17 AM
- Molycorp (MCP) -11.7% pre-market after a negative Seeking Alpha blog claims MCP could run out of cash by Q1 2015 without a capital raise.
- MCP needs to raise ~$260M in additional capital in order to sustain itself, according to blogger New York Shock Exchange, who values the company at $1.60/share vs. the current $2.57 price.
Jun. 19, 2014, 7:41 PM
- Molycorp (MCP) -4.1% AH as Moody's downgrades MCP's corporate family rating to Caa2 from Caa1 and affirms the B3 rating on the company's senior secured notes.
- The downgrade reflects continued weakness in the rare earths pricing environment, ongoing negative free cash flows, weak liquidity and high leverage, the ratings firm says.
Jun. 19, 2014, 4:56 PM
- "The downgrade reflects continued weakness in rare earths pricing environment, ongoing negative free cash flows, weak liquidity and high leverage," says Moody's cutting Molycorp's (MCP) CFR rating to Caa2 from Caa1. "The [Mountain Pass] project's cost overruns left the company with absolute debt levels that may be unsustainable in a current price environment."
- Shares -5.8% AH
Jun. 17, 2014, 6:18 PM
- Molycorp (MCP) bonds rose to their highest level in more than a month after peer Lynas (LYSCF, LYSDY) sold shares, and "distressed investors looked at Lynas and said if they can raise money, Molycorp can too."
- MCP, which has lost money for nine straight quarters and may run out of cash in another seven months or so if operations don’t improve, may benefit from new investments being made into the rare earth industry, a Loomis Sayles analyst says.
- With fresh capital, investors see MCP’s Mountain Pass facility in California becoming fully operational later this year that would help the company grow.
May. 21, 2014, 11:43 AM
- Molycorp (MCP +0.7%) is downgraded to Underweight from Equal Weight with a price target of $2.50 at Morgan Stanley, which says cash could become tight in H2 for the rare earths miner.
- The firm cuts its 2015-16 revenue estimates by ~40% on weaker than anticipated volumes due to slow ramp-up and sales mix on lower sales of neodymium and praseodymium; management is working to address both, but investor confidence is low given past shortfalls.
- Stanley does not anticipate a material improvement in Mountain Pass production during Q2 from the April run rate because commissioning and ramping up of tanks could take one to two months; also, there is risk that new bottlenecks might emerge in the process after leach tank capacity is raised.
May. 9, 2014, 3:25 PM
- Molycorp (MCP -18.6%) shares plunge for a second straight day after Q1 results brought another substantial loss, marked by a deteriorating liquidity position and lower prices for rare earth metals, and little reason to suggest that operations would turn cash flow positive any time soon.
- Today, analysts at J.P. Morgan pile on by downgrading the stock to Underweight from Neutral, expecting another capital raise this year - logical timing, considering the rate MCP is burning through cash - made all the more urgent as the Mountain Pass ramp is happening more slowly than expected.
- Shares have lost a third of their market cap in two days.
May. 8, 2014, 12:59 PM
- Molycorp (MCP -16.2%) after Q1 losses more than doubled as revenues were hurt by lower prices for rare earths and magnetic powders and lower sales volumes in its resources segment.
- MCP’s Q1 volumetric sales totaled 3,518 metric tons, up from 3,274 metric tons in the year-ago period, but average selling price fell 24.6% to $33.69/kg.
- MCP says it produced less material than expected at its Mountain Pass facility in California, citing interrupted production as it worked to optimize operations.
- Cash and cash equivalents fell to $236M from $404M in the prior-year quarter; generated negative cash flows of $45.8M from its operational activities.
May. 8, 2014, 9:16 AM
May. 7, 2014, 5:45 PM
May. 7, 2014, 4:17 PM
May. 6, 2014, 5:35 PM
- ACAS, ANAC, ANDE, APU, AR, ASYS, ATLS, ATO, AVG, AWK, BALT, BKD, BODY, BREW, BRKR, CAR, CDE, CDXS, CF, CLR, CODI, COUP, CSLT, CTL, CTRP, CXW, CZR, DCTH, DK, DYN, ERII, ESS, EXPD, FANG, FMI, FNV, FURX, GEOS, GMCR, GPOR, GTAT, GTY, HAIN, HK, HNSN, IL, IPAR, KGC, KIM, KND, KW, LCI, LGP, LHCG, LPSN, LXU, MCP, MDR, MHLD, MIDD, MKL, MM, MRIN, MWE, NKTR, NLY, NRP, NSTG, NVAX, NVEC, NVTL, OSUR, PAA, PGTI, PHH, PL, PMT, PNNT, PODD, POWR, PRU, QEP, QTM, RATE, REG, RIG, RNDY, RST, SCMP, SCTY, SD, SFM, SN, SWM, TCAP, TGB, TGI, TROX, TSLA, TWO, TWTC, TXTR, UGI, UIL, UNM, WGL, WR, WTR, XOMA, Z.
Mar. 26, 2014, 3:38 PM
- Analysts say rare earth elements will continue to fall this year after China loses a trade dispute over its export controls, as new mines boost output and while demand in high tech products disappoints.
- A price war could break out after the U.S., EU and Japan won their case over export restrictions they said gave Chinese companies an unfair competitive edge in key sectors, says Ryan Castilloux of Adamas Intelligence; China's "only tangible defense becomes competing head-to-head on price with emerging global producers."
- Investors already are concerned about excess supply as Molycorp (MCP -3%) and Lynas (LYSCF -12.5%) boost output at their new mines; MCP aims to boost output to 20K metric tons/year after producing ~1K metric tons in Q4 2013.
- Also: REE -0.6%, AVL -2.4%, GMO -3.7%.
Mar. 26, 2014, 12:15 PM
- A World Trade Organization dispute settlement panel agrees with the U.S. in a major dispute, finding in favor of U.S. claims that China’s imposition of export restraints on rare earths, tungsten and molybdenum breach WTO rules.
- China, which produces more than 90% of the world's rare earth elements, imposed strict rare earth export quotas in 2010, saying it was trying to curtail pollution and preserve resources; prices soared by hundreds of percent, and the U.S., EU and Japan complained that the restrictions gave Chinese companies an unfair competitive edge.
- Rare earth miners include Rare Element Resources (REE) and Molycorp (MCP).
MCP vs. ETF Alternatives
Molycorp Inc manufactures custom engineered rare earth and rare metal products. The Company's reportable segments include resources chemicals and oxides magnetic materials and alloys and rare metals.
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