Ann: Altech - Stream Finance Facility Term Sheet Signed, page-54

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troyus

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17/06/18

18:31

Post #: 33766552
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Originally posted by Muad'Dib ↑

I don’t think the $800k earmarked for development is for site prep.
Development appears to be a bucket related to all sorts of project work. In the December Q they burnt $1057k and September Q $5720k.
It covers payments to SMS for the detailed engineering, the patent costs, permitting, finance development costs etc.
It looks to me like they have sufficient working capital/cash to get them through until the end of the year. The big-ticket purchases of Meckering and Johor are now out of the way.
Stream finance – ‘Funds able to be applied to the development, construction and working capital requirements of the project’.
I doubt the Senior and Mezzanine loans could be used for working capital, so the stream seems as flexible as cash from a CR if the banks approve it.
Burning question is, how long before we could draw on it?
‘Combining the streaming facility with senior and mezzanine debt would provide total project finance of US$340M, which the company is considering’.

This is a very serious option. Zero share dilution and >US$40M for working capital and contingency, which would easily get them through the next 3 years.
I was shocked when Iggy stated it would take an additional 6 months to complete the Mezzanine loan.

In the video he stated, ‘the company has decided to raise a ‘portion’ of the equity component over the next month’. How do we interpret this?
Is it irrelevant now, as it was said eight days prior to the stream finance announcement, or did Iggy have the stream finance option in mind when he said it?
We just gave them the option of a CR for up to $30M.
Does ‘portion’ suggest they go for a minimum raise, say $10M, and use it on just the site works and ordering of long lead time plant and equipment?
That means some share dilution, but hopefully based on a now higher share price.
If stream finance can’t be approved relatively quickly then a small CR seems the way to go.
As much as I hate dilution, I’d hate to see several months delay waiting for stream finance to become available. Every day production is delayed represents ~ US$300-500K in revenue.

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Thanks for the detailed reply, very much appreciated!
50-100mill shares issued I can live with...3-400mill is another story!
I love these guys work and continue to be impressed with everything about this project and the team bringing it to fruiton.
gla
T

ATC Price at posting: 18.5¢ Sentiment: Buy Disclosure: Held
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Ann: Altech - Stream Finance Facility Term Sheet Signed, page-54

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Ann: Altech - Stream Finance Facility Term Sheet Signed, page-54

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