You’ve sidestepped some key issues here:
"What would happen then? Repeated CRs at lower and lower share price to keep pushing ahead"
While this is true, after the C&M announcement, the share price halved anyway. The market didn't reward JZ for his prudence. Many would be aware that it’s likely that more CRs will be needed just to maintain C&M, albeit fewer, but starting from a much lower base, thanks to C&M. It's a different, not better, route, and essentially it leads to the same outcome. AGY found themselves in this precarious position due to poor capital management, early over-hiring and significant overspend on commissioning and rectification works due to poor plant design (and of course failing to close a funding deal during peak lithium-mania).
As for resuming operations when market conditions improve, you’re oversimplifying. Restarting isn’t as easy as flipping a switch. First, they’ll need to raise capital for plant repairs, which they currently lack. Then, they must hope the staff they let go haven’t been hired by competitors in the same province, like Eramine or POSCO. If I had just been sacked by AGY, I'd be wary about coming back given the likelihood of it happening again in the next downturn. Once bitten, twice shy and all that. If they can't get them back, they’ll have to train new workers, which is costly and time-consuming, especially in a challenging environment like the Puna. C&M isn’t cheap. And all this only gets them back to the point of trying to fix it again. It's not a path to glory, it's just a path back to where things were a few months ago, with some additional dilution along the way.
Most would agree that C&M wasn’t the ideal path, but AGY had little choice. However, praising management for this decision ignores their failure to prepare financially during better times. While there may be some hope on the horizon, AGY’s viability hinges on a price point of around $18k per tonne, while current prices are nearly half that. Many competitors, with lower costs like CATL's Jiangxi lepidolite mine with a reported viability price of US$11k per tonne, could easily step in and keep prices suppressed below AGY’s breakeven/re-start price.
These are tough times for some, but much tougher for others.
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