assuming full placement of new shares (as indicated in the most recent press release), GXY would receive $46,75M. 10,25M of these would be paid to the bondholders reducing the bonds outstanding to $41M. Redeeming the bonds in full would extinguish the $41M bond debt but would not lead to a cash influx for Galaxy.
As of 30/06/2013 GXY's cash position was 1,4M. Significant changes to this position would be
+ $46,75M (100% placement) - 10,25M (payment to bondholders) - costs associated with the offering - operating costs and interest payments (roughly -12M per Q)
So I would expect their cash position to be approximately 11M at the end of the year, barred any additional significant items.
KEEP IN MIND: GXY HAS BANK LOANS OF $134M OUTSTANDING. THAT'S IN ADDITION TO THE BONDS!!!
According to the ASX filings, less than 1M options have been exercised as of today and with the current share price significantly below 8c there will be no additional options be exercised.
Regarding the value of Galaxy's assets I don't know where you derive your numbers from. In one document GXY cited $50M for Mt. Cattlin and James Bay. And that is probably going to come down significantly once these assets are being offered. Mt. Cattlin is an unprofitable mine on care and maintenance. New lithium supply is about to come online (Talison + "big 3" expansion, Orocobre and others) so who is supposed to pay $50M or even $80M-$100M as you said for Mt. Cattlin?
To sum it up, the situation I expect for the end of this year is this:
Shares outstanding roughly 1,8B Options outstanding roughly 1,8B Cash position roughyl 11M Bank debt roughly 134M
Bond holders partially keeping the bonds would decrease the number of shares + options outstanding but increase debt and interest expenses.
Not a pretty picture IMO!
GXY Price at posting:
5.4¢ Sentiment: Hold Disclosure: Held
