I don't get it Roboshan. I got the impression the merger/takeover was a last ditch effort to save the company. Why would they be exploratory drilling and spending more money if they were trying to trade their way out of this scenario?
They had $2.7 million cash after the last Sep 2011 quarterly. At the end of the Dec 2011 quarter, one assumes they would have spent about $2 million (as per the previous quarter), leaving them with ~$700,000 cash. Their market cap at 20c was about $13 million. A capital raising would have been needed very soon and that would have meant more dilution and a much lower share price than 20c.
That is what you are looking at again if the deal is rejected. Sounds to me like cutting your nose off to spite your face.
The SLR $1.3 million secure convertible note facility (+ $700,000 = $2 million) gives PRH another quarter of survival, while the deal is ratified. If the deal is not ratified, and there is no better deal, then surely the administrators get called in.
Just calling it like it is. Sorry if I have missed something and yes I understand the pain of long term shareholders who have been burnt.
PRH Price at posting:
2.7¢ Sentiment: None Disclosure: Not Held
