what are peoples thoughts regarding MNB's funding options?
the obvious ones are:
1. Rights issue: would have to be pitched at around 10-12c and unlikely to raise anything signifcant given the poor uptake of the last one at 27c. Can't see the major shareholders tipping in either
2. Capital raising to sophisticated investors: again would have to be pitched around the 12c mark to get it off the ground. Given Paterson's has started following MNB I wouldnt be surprised to see this happen. Not a good outcome for shareholders and would take something special for the share price to recover in the short term
3. Strategic partner: this process is already underway but I question whether they started the process early enough. Given the presence of local partners, it may be off putting to strategic investors. Certainly much easier if you own 100%
4. Assets sales: MNB certainly has a lot on its plate. IMO they need to commit to either Cacata or Kanzi, they arent going to be able to do both at the same time. Possibly better off selling down one project and hold a minority interest whilst focussing on the other. As I mentioned before the Potash license has added no value and if it is as valuable as management say then that value needs to be crystallised.
5. Alternative funding structures: there are many firms/vultures that provide alternative funding such as convertible notes, bridging loans etc. These are usually called upon when a company is desperate. Pray to god they dont go this way.
a bit tired of hearing management go on about how "undervalued" they are and how MNB will be "rerated signficantly"
they need money and its time to look at what is the best option for shareholders
MNB Price at posting:
15.0¢ Sentiment: Hold Disclosure: Held
