Acquisition Interest in Mt Kare - IDC Chairman, page-2

Nectar,

Although this is good news for the company's chances of survival in general, it's no comfort for shareholders in the short term I'm afraid. A debt for equity swap would mean further issuance of shares, on top of the amount that will be required to fund the adit etc.

If we need say a total of $20 million to develop the adit and to convert existing debt into equity, then that represents the equivalent of 1.1 billion new shares on issue. That's nearly double what's already on issue and once totalled @4-5 times the amount of shares that were on issue a couple of years ago. Quite simply there is no avoiding this pain now IMO.

We should not forget that it was only 7 months ago when Promnitz and the Farleys had the chance to secure $15million at 9c (i.e. for only 167million new shares) but when that all fell apart that window of opportunity was gone forever.

Now the best we can hope for is some sort of a royalty streaming deal or LT finance arrangement with low rates instead of mass issuance of new shares, but without an ML and a BFS the chances of that happening in the ST are not good.

Not trying to be negative (like Dermott I am confident IDC will one day produce) but we should not be delusional about SP expectations and the effects of dilution in the short term.

Cheers
Elpha