If we do a capital raise from shareholders, it's a disgrace. We're meant to be Australias leading high grade iron ore project. Begging for 15m because management didn't put a back up plan in place.
Raising funds from Shareholders is the easy way out. Can someone tell me why these massive billion dollar companies won't give us funding to see the project succeed? For something that they require in the near future.
They owe it to shareholders to protect our value at all costs. Buyers want security, we need short term funds. Surely a company would give us 15m if the deal was good enough. I presume we would have a quicker time to production starting with 5mtpa. Our buyers need to lock in supply, as it will be limited.
15m cash for the following terms: Option to buy 1mtpa for 10years First year 50% discount on initial 1mt Equity in HIO for the equivalent cash, with free buy back clauses when milestones are met.
That is a made up scenario, but that would result in no dilution for shareholders if we hit milestones. It protects the buyers investment, locks in future supply and an initial risk/reward discount.
It would also give massive confidence for shareholders and our Share price would be in a much better place for future funding.
Can someone tell me why we can't get that and why management is going to come to us to raise funds for their mistakes?
HIO Price at posting:
11.0¢ Sentiment: None Disclosure: Held
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