report in the australian, page-4

If AFHL is getting these shares, it will take them to 5.66% interest in the company immediately.
[ 45,000,000 / (750,000,000 + 45,000,000) ]

Then if the AFHL raising does go ahead, they will have
1,045,000,000 shares out of 1,795,000,000 = 58%.

Then if the original agreement holds and the sp goes to > .06, they will have another (17,500,000/.06) = 291,666,666, total 1,366,666,666 shares out of 2,086,666,666 = 65.5% of the company.

if the $25mil rescue goes ahead at say 1.6 - 1.7cc, this would be aprox 1,500,000,000 shares out of about 2,295,000,000 shares or about 65% of the company. ie. about the same amount of dilution, but mst gets $10mil Less in the bank.

If the "rescuers" are in secret cahoots with AFHL (or vice versa) as has been suggested, this thing has been a ploy to save $10mil and they would have in total a control holding of just over 70% of shares. If the "rescuers" have also been buying up (as has also been suggested), they could also be up over the 70% mark, or more if they are somehow linked to AFHL.

If the rescuers (whoever they are) or AFHL can get another 15% or so, they will have enough to force a takeover and privatise the company.

What's the betting here? Opinion/guess (aka Moosey's scenario):

Enough money will come through to keep mst alive. Majority control passes to the "rescuers" with around 70-75%. They'll try to keep the price down whilst shaking out sales from long term holders who will have maybe around 15 to 20% of shares with MOD holding maybe 5 or 6% if he dosen't continue to sell. Later there will be a takeover bid. SP will likely go up for the last few percent if enough holders hang on. This will probably depend a lot on MOD who will have the largest non "rescuer" holding if he stops selling now, not enough to stop a takeover himself, but enough in conjunction with other small holders. Hopefully, he will think that it's worth hanging on to squeeze a good price out of the last lot. (If you are reading this MOD, please consider stopping your dumping).

Maybe the "rescuers" only want majority control, not absolute control? If so, in the long run we may get our money back.

The alternative is that money doesn't eventuate, mst goes into administration and will predominantly benefit secured noteholders with whatever could be rescued, followed by noteholders, then shareholders.

There are aprox 142,500,000 notes still on issue at .135c = $19,237,500 aprox not counting any interest due. Of this, aprox $14,780,000 is due to secured noteholders. If less than aprox $15mil could be raised by an administrator, it's basically up to the secured noteholders as to whether they take over the company or settle for what they can get. If the board can't manage to raise the $25mil backup finance whilst the company is still a going concern, the administrators would have a hard time raising enough to leave anything for shareholders.


It's not pretty whichever way you look at it. It seems like AFHL is a dead duck and the board has been taken for a ride. For shareholders, we can only hope that they can really raise the money that they are negotiating. If so, it is worth a bet to hang on if you are a long time holder trying to get your money back rather than just cut your losses now.

.. just read the latest announcement. Seems like there may be another party willing to put up some money..maybe a better deal than the $25mil rescuer..?

My view as a long term and relatively substantial holder is I don't want to cut and run and lose a lot now. In spite of many perceived failures that they may have had, I believe the best option is just to trust and hope that the board manages to swing one of the deals. If they don't, well I've lost quite a bit, a blow, but survivable.

Along with others, I think the technology will eventually become pervasive in modern weaponry and will one day make some people a lot of money. I aim to stay the course and give it a chance to make me some too. Gone too far to give up now!