Odds to hold., page-50

With hindsight, my decision to also remain in this company appears wrong and I made a mistake but let us summarise what has happened to this point. PDN was making successful efforts to lower debt by reduction of costs, buy back of bonds etc and was to solve the impending 2017 bond repayment with the proposed sale of a further 24% of LH to CNNC, all this providing confidence in the future of PDN. Starting in late 2016, a series of left field events has precipitated PDN into a state of uncertainty. The premature announcement of the sale to CNNC before documentation and then lack of communication with CNNC lowered the sp from around 25c to around 15c. The realisation of failure of the sale and resorting to Korda Mentha for a proposed restructure itself triggered an option for CNNC to buy all of LH. CNNC took the maximum time available before confirmation. Bond holders (2017 and 2020) agreed to a standstill until June and VA was avoided. Although PDN had flagged seeking resolution through arbitration concerning the validity of the trigger, PDN could not have survived the delay in outcome and proposed a new restructure around sale of LH. Bond holders agreed to an extension of the standstill until September. The outcome now depends on the valuation of LH. If it is sufficient, the second restructure proposal may succeed. After an extended period of suspended trading (which could have been instigated long before the recovery to 17c), the sp remains at new lows (for recent years). Failure of the spot price to recover to levels rendering PDN a profitable concern, and the bleak outlook for uranium in the futures market, in spite of recent hype, gives added uncertainty. On the other hand a substantial recovery in spot price would have solved all these problems. At worst PDN could have already been under VA. At best, if relatively debt free, it will survive on further assets sales or attract a TO. While this drags on I am reminded of a Russian joke about Brezhnev who said: "Comrades, I have bad news and good news. The bad news is that we will have to eat sh#t for 7 years but the good news is that we have plenty of sh#t."