Hi Haplo, I agree with all your points. GXY should have entertained the possibility of VA, and probably did, but I'm not sure it would had mattered either way. GXY could have granted an extension for A40 to explore recapitalisation options with other parties, which likely would have resulted in a huge SPP which would have massively diluted GXY's investment. VA is essentially doing the same thing. I think GXY was damned if they did, damned if they didn't and just had to play the cards they were dealt during the process of protecting their previous investments. This whole debacle was prompted by MC's actions/mismanagement, and I think it caught GXY off-guard. One offtaker was always a bad idea, and it came unstuck. While a number of negative factors aligned simultaneuosly, I would have hoped for a better response from A40 management.
I think the fact that Korda Mentha were in A40's office since July says more about MC than GXY. It indicates to me that he probably had knowledge that A40 was trading while insolvent, which seems hard to dispute given the recently revealed $101 million dollars claimed by creditors. You are correct that GXY should have been more researched. I too should have been better researched, and have come to learn a lot from the A40 threads, particularly from well informed posters such as yourself, whose contributions I value.
I honestly don't think GXY was seriously considering a TO in the short term, I think the intent was to slowly build a bigger position and at a later stage possibly a merger between the two.
Regarding my first post, yes, long time reader first time poster and as you pointed out I have had thoughts about a possible TO of A40 via script. I would still be a fan of a script offer if weren't for the recent discovery of the $101 million owed to creditors. My thoughts from my first post were 8-10 A40 shares for 1 GXY share based on the market caps of the respective companies at the time. I'd still be ok with this outlay, which at the moment would effectively value A40 at $38-47 million. I don't want to see GXY invest any more than a total of around $120 million AUD in A40 in the current climate, whether that's via script or cash. We're already in for around $80 million, hence my preference for the low end (10:1 = $38 million or thereabouts). Either way the unsecured creditors would have to get cents on the dollar at this point. Now I know this is an insulting amount for a quality asset such as Bald Hill which we all know should be valued in the hundreds of millions, but I could make the same argument for GXY's market cap based on it's assets.
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