SO4 0.00% 31.0¢ salt lake potash limited

Ann: Resignation of CEO, page-95

  1. 4,855 Posts.
    lightbulb Created with Sketch. 2375
    There are basically four scenarios:
    1. There will be another request to extend the suspension before trade opens on Monday. This seems the most likely as there is a lot of work that needs to be done before the company can emerge from suspension in the way they would most want to have happen (see scenario 2). I don't believe there has been enough time to do all the necessary work since trading was halted.
    2. There will be an announcement with a detailed plan to proceed to full production, and the suspension will be lifted. This would be the company's preferred option. To satisfy the market the plan would have to provide a detailed explanation of all the issues affecting plant operation, achievement of binding sales contracts, and harvest volumes. Each issue would have an accompanying plan to resolve, mitigate or tolerate it and the const of doing so. There would have to be a project cash flow projection showing revenue against expenditure, and the amount, source and timing of additional funding required to cover the shortfall. As you can see it's pretty unlikely that the company is going to have this ready before Monday. The result after reopening will be determined largely by how good the plan is, and what deal the company has been able to make to fund the shortfall. Based on previous performance I don't have high hopes in either area.
    3. There will be an announcement that the company is entering administration, and suspension will remain until the administrators analyse the business and provides a report to creditors and owners. The outcomes of administration are likely to be either liquidation or restructure. Shareholders won't like either of those options. It might be hard to recover 1c per share in either case.
    4. There will be no announcement and trading just resumes. This is vanishingly unlikely as it would represent a complete dereliction of duty by the board resulting in a flood of lawsuits.

 
watchlist Created with Sketch. Add SO4 (ASX) to my watchlist

Currently unlisted public company.

arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.