asx, page-26

I don’t know when PL knew about the default but he certainly must have known something was happening when volume picked up on Thursday/Friday.

Management should have put NKP in a trading last week.

Now NKP will try to negotiate a block sale through a tender process. Maybe they are optimistic there is someone prepared to buy the shares. It could be DRA, Matrix, Xstrata or even ARM/Anglo and this may be an opportunity for one of them to buy in cheap. They’ve all expressed an interest Garatau at some stage and there could be others interested too.

Genorah has defaulted, not NKP, and this has weakened their hand. They will probably end up with less than 50% of NKP. How does that affect NKP? They are running low on cash so they would want the JV to be finalised quickly. I’d imagine Genorah now would want the same too, so they may settle for less attractive terms.

The rumour before was an offer at 30-40c but now it may be more like 10-20c. I think there would be quite a few takers if that was offered.

The fact remains that NKP has a valuable resource and parties will still want to JV, it’s just that now there is the opportunity to get it at a lower price.