JZ consistently emphasized his pursuit of "the best deal," implying that this pursuit was exclusive to AGY. However, it's common-sense that all companies seek the most advantageous deal available. Yet, some companies misjudge their timing and overplay their hand, as seen in AGY's case. JZ admitted in an interview to being caught off guard by the swift decline in lithium prices. He also conceded in recent releases that the current market conditions are negatively affecting negotiations for a funding agreement.
It's reasonable to assume that securing a deal during a bullish market would have been more favourable for AGY. However, that opportunity has passed, and now AGY faces urgency to close a deal due to production costs exceeding revenue, and cash reserves dwindling. With this time constraint looming, JZ can no longer wait for "the best deal"; he now needs to settle for the best available deal. And in the current market, those options are probably quite limited, explaining the recent resolution to increase the placement cap to 25% SOI.
Only the perma-bulls will argue that you can secure an equally favourable deal during a bear market as you can during a bull market. Reality begs to differ.
AGY Price at posting:
12.0¢ Sentiment: None Disclosure: Not Held
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