financing of Dubbo. Considering it needs around $2.5bn and ASM cash position is next to nothing compared to what is needed to get Dubbo going. ASM will have to borrow 100%. That will be massive risk for any bank.
For any bank to finance such deal they will demand Gov backstop. Those potential profits from Dubbo are that - potential profits and until the operation is up, running and proving it can be operated as per spec nothing is guaranteed. This will require number of banks to take part in order to reduce their risk exposure. The project is massive. We are not talking here $200-$300m.
Alternative is ASM to do part CR and part debt. If they do CR I think they will need to rise at least $500m and that will mean massive dilution for those not taking part. Such CR will be done via the partner who will now own great deal of ASM.
That's how I see it anyway. But I may be missing something.
ASM Price at posting:
$1.25 Sentiment: None Disclosure: Not Held
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