I guess we now know why there was no capital raise and why Purvis resigned: The $10m liquidity requirement was not the only one and it was clear they would breach the $100m figure.
They need a waiver from Investec anyway. And it looks like they will get one. Best Investec can do as it won't be easy or even impossible to sell the Guyana subsidiary they have as a collateral due to intercorporate debt. New liquidity limit $5m?
Based on the cash flows from June quarter I would estimate they are 8.5m-ish liquidity-wise right now. September being dry season probably not much more outflow going to happen. End of September the debt repayment which will leave them with 5-6m liquidity.
So despite my estimate there will be no new capital needed in the September quarter.
They basically do need whatever they are going to burn in the December quarter (remember: dry season and less hedges). After that hedges completely gone and Smarts 3 back on track again.
So I will shift my focus to December financials now.
Buying by Elsztain indicates he is going to do a deal involving Casposo (meaning his buying price will be the bottom), cash for the 30% would be more than enough for the December quarter and could even be topped up with a $4-6m mini-cr.
Troubles that could be anticipated for a long time but that are playing out in a very different way from what was to be expected.
Hopefully they will get the company and current management through the nadir as the future with the complete mine operating again instead of just being in an emergency mode looks much better.
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