Very disappointing that there were no new details on the financial side of the Daunia/Blackwater acquisition today. The quarterly report did not appear to provide any substantive new information on the acquisition despite WHC saying this would be in the quarterly report. On closing there are normally adjustments to the price for a number of things such as inventory adjustments, working capital etc. We still do not know how WHC is funding the substantial working capital required to run the Daunia/Blackwater operation. The new working capital required in the operation for operating expenses and receivables is substantial, probably over A$300 million and maybe as much as A$500 million. How is this being funded? No surprise they did not mention cash balance. There is none, other than minor bank account balances, since virtually all the cash reserve went to pay for the deal and minimize the amount of debt required. This is unusual that the financial details are not provided on closing an acquisition of this magnitude. Hope we do not have to wait 3 months or more for the year end financials to find out what the details are.
WHC Price at posting:
$7.90 Sentiment: Buy Disclosure: Held
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