The inability to get to the next stage of exploration and production of our assets has been the biggest monkey on the back of STM. You would think theoretically that any deal which didn't involved giving all existing shareholders cash for 100% of their equity, would see a greater multiple unlocked. With that said, the (very understandable) wall of selling which might come from prices getting close to people's cost base in the 2.5-3c region would be large.
Pending the cash burn for the past 3 months since the Half Yearly report, we can assume we have somewhere in the realm of $1.5-1.7m of cash on balance sheet. Add to that this raise of $3.76m after fees and we are around $5.3-$5.5m of cash - aka around 2 years of cash at our current burn rate.
I'll be curious to see what happens if they decide to pursue this potential M&A transaction of another near-term asset, no doubt that will need more cash from someone (be it a JV partner, buyer or Morgans/Canaccord running their usual round-up of SMSF punters).
STM Price at posting:
0.7¢ Sentiment: Hold Disclosure: Held
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