How about a contrarian view to the contrarian views taking the words straight from the mouth of Mgmt.
Fast forward the ~23min mark... the bolding is mine.
"... we just raised Capital with Bluescape a very quality Private Equity Firm based out of Dallas, Texas. They're a large institutional private Equity Firm and they looked under the hood at Boron, and they looked at the team, the permits in place, and the access to water and infrastructure, and really that was a great partnership in our eyes. They offered quite more than just capital, and we look forward to working with them. Going forward, that puts us in a very strong financial position - $68 million of cash available - and through the small scale. Tyson is very well equipped to get that up and running with the cash on the balance sheet and we're in very nice position to be very dynamic when it comes to the capital markets. Our funding sources - again the best opportunity is government government related capital, the next is customer related capital, the next one after that is traditional debt capital and then obviously there's equity raises as we go, but we have a lot of options available "
Yeah right. This comes pretty much after JT waxes elequently about how well FEAM has done capturing the ear of the capital markets.
Just so you know who you are dealing with (as FEAM did) https://bluescapegroup.com/portfolio/ Note how they allocate capital ... deep into "growth capital" and "recapitalization" and lots of shale (oil & gas) assets.
Just guessing here, but you know that in every poker game there is always a fish ... and if you don't know who the fish is ... then you're the fish.
Let's be clear here ... NO ONE FORCED FEAM to accept the terms of the US$60M Convertible note. FEAM mgmt agreed to these terms to get the cash - if they were "too restrictive" then they should have continued shopping ... they had the ear of the capital markets, no? So they said.
Anyway, I've referred the C-Note terms before and the financial covenants that allowed the default event to occur. Net net though, FEAM is out of money to progress the project ... hence the recapitalization. No easy way to say that. No easy way either to say simply accept and vote yes to recapitalizaton ... otherwise its Ch 11 and cancellation of current equity interests owned by shareholders. A small % of something is better than certain 0%.
Sort of hard to figure out what equity the present shareholders end up owning .... really depends on new equity and what amount of notes converted etc... might be around 20% +/- 5% of the new recapitalized company. Anyone done any scenario calculations.
9:00am (Syd) 20th Dec is the time for the call.
5EA Price at posting:
22.5¢ Sentiment: None Disclosure: Held
(20min delay)