it is quite possible that FCF is lower than I hope.
What I dont think would happen is D4E swap because if a company is Cash flow positive - there would be takers of loan at a higher repayment rate than what the banks are taking. Or getting a dividend on strategic investment by some cashed up investor who would have larger risk appetite.
In my opinion banks would convert a portion of their loan into some sort of hybrid style arrangement which would provide them with additional dividends on top of interest and repayments. This would theoretically reduce the "debt".
I dont think banks are keen to pull the rug - sets a bad example that they are only fair weather friends. They have future clients to service too. I've seen this happen before with other companies.
SGH Price at posting:
26.0¢ Sentiment: Buy Disclosure: Held
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