XavierX2,
The company has had no problem selling profitable assets to raise capital to fund restructuring of unprofitable businesses.
Paperlinx has survived for the last few years, despite continued losses. However this cannot continue and at this point, the outcome is binary:
If the restructuring fails, nobody will be lining up to recapitalize the company. We shall all lose our respective shirts.
On the other hand, if the restructuring is ultimately successful, then PXUPA will recover faster than PPX. Take a look at Elders for comparison. If what is left of the business is truly unable to support restarting distributions, then we can have a discussion at that time, but not before.
Allan Gray and other PPX holders understand that and would like to take advantage of the situation to position themselves to benefit in the event that the company recovers. To which I say thanks, but no thanks. PPX holders are negotiating from a position of extreme weakness. Why would we make any concessions to them at this time?
The reality of course, is that this is all an irrelevance unless the business can be turned around. Which is why this has to be Job 1 for the management team, not wasting time and energy trying to restructure the hybrids.
PXUPA only.
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