General comments/chat, page-32887

My starting point on this is why I have dismissed JM's "we can get debt funding" stuff as naive. The product is not fungible like gold or oil or copper so the traditional resource finance banks in Australia (Macquarie, RMB, Rothschild once upon a time) who did gold loans against forward sales from your new mine had a great business. And they stole some option equity too. HK is not fungible, it is a dark market. So the only debt funders are the trading houses (count your fingers - there's a reason none of the Western ones are listed companies, the Japanese are) or the product buyer. Now the product buyer may well do this and @Pezz69 has made the point that the amounts involved are not horrendous (<$100m less what's in the tin). But to me that still means there will be an equity contribution needed which is one reason why there are still shorters around. The other is what @GIGAChad has noted, but many of you confuse his brusque manner with the message - these stocks trade at BIG discounts to NPV until derisked. 40% is NOT a BIG discount. Like it or not @GIGAChad is factually correct. Now you are all arguing about is that the NPV is "understated" - note @DanielWood brilliantly simple comment above - which suggests it may not be. Those of you believing it's so base case, conservative obviously believe bank CEO's when they tell you they've provisioned all their bad debts....... IMHO, either a Boral or other trade buyer will offer core debt with an equity kicker - because they can get one - AND there will be an insto placement + SPP. The equity kicker in the debt package will be low ball, but the placement MIGHT be higher if the shares respond to the financed BoA. However, as @Guemar notes, most likely they will be done SIMULTANEOUSLY as the HK buyer will want as much certainty as possible so the contract will be contingent on the equity raise. So same price. If it's a good counterparty, THIS POINT is where PROPER instos will come in. At this point, the shorts could get squeezed, but from a lower level than here. Of course, the broker may just place the stock to the shorters. And you all know who the broker will be.....

Does all this mean disaster? No. It just means to get to the destination means another dilutive equity issue (likely <10c) but a real operating company. This is what you want Wilkes & JM and Ranford ruminating about and having meetings with financiers, and building a team, not doing "Coffee with Samso" and giving out accurate but confusing messages. The reason JM works 10days a week 50 hours a day is because he is disorganised and not focused on the KEY goals. My hope is that Wilkes puts him in a straight-jacket with blinkers on. Then you'll get the best out of him, and get your "mine". I'm as hopeful as everyone that buyers in Europe will bite.