west australian story : not good, page-16

OK - I spoke to Geoff Gander this morning - a good sign that he is taking his calls.

The debacle of Ferrone "borrowing" the $414,000 is one thing, but that caused a serious look at the company's overall finances, and the story wasn't the best. Lots of debt, loss-making T & I, etc etc.

The banks are being very aggro, and demanded all sorts of conditions on continuing finance, and that's why all those moves are afoot to refinance the company.

I gather it was a case of either go into liquidation now, or try to form a rescue package which is what they've done. An auditor's report should come out with the notice of shareholder meeting in the next week or two. The 1-cent issue price is what they thought they could get for the company in its present state, to keep it afloat and start to turn it around. Also, the board restructuring is aimed at the turnaround.

To cut a long conversation short, Gander feels that the company CAN be turned around with good management, similar to the way that companies like TOX and CMO have been turned around. He is optimistic that the share issue will proceed according to plan, and all will be well. And he also states he believes that the share price may well get back up to the 4-cent level or higher once stability has been achieved, and that it may be quicker than many people think.

In short - it was go to the wall now, or try to rescue the company. They opted for the latter. At least it gives us some chance of our shares being worth SOMETHING at least, particularly if we are a bit patient (grrr - gritted teeth) and don't just sell as soon as they get re-listed.