a share swap?, page-13

Graham

>Maybe other people are putting pressure on PPX to clean up its act.

>Banks, suppliers & credit insurers readily come to mind.

Interesting. I can only assume this means the creditors want a capital raising to reduce their risks. Removing the PXUPA debt would not worry them as it ranks last.

Blues

>PPX buying PXUPA at $9 makes sense, but I'm not sure if they can do it on market as it could be considered as "making an offer" for only part of PXUPA and I think (but not sure) they have to make any offer available to all PXUPA holders?

I thought this was addressed some time ago and the general conclusion was that they could probably buy on market. The real issue is that they do not have the cash at present.

If Graham is right and the creditors are breathing down the Board's neck how about a deal as follows.

1. The Board finds an underwriter prepared to underwrite a rights issue.

2. The rights issue is offered to PPX shareholders to raise capital to buy out PXUPAs and to generate extra capital to keep the creditors happy.

3. A cash with perhaps a partial script component is offered to PXUPA holders to get their agreement to the capital raising.

The difficult part would be to find an underwriter prepared to accept a deal acceptable to both PPX and PXUPA holders.

I would be happy if as a PPX shareholder I could take up shares in a way that did not dilute my interest and that the PXUPA part be structured so that only interested holders had to take up an offer. After all all PPX need from PXUPA is an agreement to let them raise capital. If the deal is fair both those PXUPA holders who sell into it and those who wish to stay put would benefit.