That's a valid question. If the banks did apply pressure I think...

That's a valid question. If the banks did apply pressure I think there are a few obvious responses to alleviate any pressure, namely: (i) sell AKG's 10% stake in Redhill (RDH) to raise c. $2.5m; (ii) sell one of its high quality standalone businesses (eg, STA, DE or AAP) to raise $6m-$8m; (iii) raise director loans like they did last year (eg, $4m raised last year; directors own about 65% of the company so they would be keen to support the company); or (iv) another rights issue.

Either way, they could easily raise $8m - $10m to pay down debt and that would leave the company in a positive net cash position (note that they had around $8.5m of cash in trust accounts as at 31/12/15).

Longer term, the key is to fix the performance of the base business and tap into the strong growth in the international student sector. If they can do that, and stop the losses in their other businesses, then they should return to decent profitability in FY 17.