Ann: Letter to Shareholders-KBL.AX, page-19

I received a letter from the company yesterday, seems like I didn't sell my position out completely!!!

Reiner001, All very good points. In my mind the approach to solving the KBL problems has been piecemeal and in a way seems to be leading the company towards being delivered in rather better condition to the bond holders come Feb/March next year. I am not convinced that injecting $6m now will solve anything other than keep KBL afloat until it's time to negotiate with the bondholders and then what?
Don't get me wrong, I want this story to end well, I mean it's an actual producer and its capped and ~$5m but the issue I see is that Management are looking after the bond holders and not the shareholders (although is many cases they are the same). If I was running the company, instead of raising $6m and plugging a hole for a short period of time, I would find another company to make an all scrip bid for KBL at $5-6m and recommend to shareholders that they accept. Once the board recommend that the bid be accepted then the bond holders must convert their debt to equity at something like 40cents per share. Once that debt is removed then I may be convinced that KBL could dig itself out of the mess.
If of course management have unsuccessfully sought an "opportunistic" suitor then you have to ask yourself why would you put more money in when a suitor would not?
So in summary, limited ore going forward, short term debt maturity dates, key management personnel that are major bond holders (therefore potentially have conflicting interest with other shareholders), a Chinese partner that has stopped funding Sorby and an urgent capital raising which is being hailed as a kind of magic bullet to save the company??
It's going to take a "metal storm" of magic bullets to save this one. My prediction is that the bond holders will dilute everyone down to near nothing and say thanks very much to everyone that helped pay down the other debts. Call me cynical but this has a relentless downward spiral on it and no-one is addressing the elephant in the room being the bondholders and until I hear more about that I am opting to stick with the age old metaphor of "not all that glitters is gold"