Just to clarify - KFW is a development bank backed by the German Government, but it is not the German government. But yes, you are right - KfW funding was a huge confidence booster.
Having said that - The role of KFW is to support the German Export Industry. I am sure that SMS could convince them that they are able to build the plant (and I am sure they can), and this might have been KFW's main decision criteria. Not quite sure whether they put lots of emphasis on whether ATC is later on as well able to make money with this plant.
As well - KFW has first dips on any securities, i.e. if things turn pear shaped, they own and can sell the buildings, equipment on so on. Anybody providing mezzanine finance would only get crumbs, if there are any left after KFW being satisfied.
Not quite sure whether ATC's main problem was to rely on MacQuarrie with mezzanine finance. I think their main problem was that they didn't manage to provide the necessary information any sensible mezzanine finance funder would ask for. Lets face it - Iggy & Co have no clue whether they can sell their HPA and at what price (the famous "opaqueness" of the market they did absolutely nothing about to make it more transparent). But - if you are right - and if they could have got finance some other way, than there is clearly a case for giving Iggy and Co the boot. I guess - really - what for did he get all his fat salaries and shares he already sold? Why would anybody still support a company run by such a bunch of inepts?
Maybe something worthwhile asking at the next AGM?
ATC Price at posting:
6.2¢ Sentiment: None Disclosure: Not Held
