The only reason anyone would want to pay above net asset value for MEL would be if there is a future economic benefit from the losses MEL has incurred over the years OR they are trying to buy the cash backing of the business for less than what it would cost them to raise equivalent sums in the market.
So, either they are going to come up with a merger scheme with either MEO, AJL or some other entity that would allow MEL's losses to offset future gains, which would indicate they are very confident about a current project OR they are trying to get their hands on our cash without paying the full price for MEL. I think the latter is much more likely the strategy given the current prohibitively high cost of capital for junior resource companies.
If Lawnsdale votes against the capital return, then their intentions are clear. It would also explain why Vaughan was offered such as high price for his stake.
So, any MEL holders that still have a pulse, please vote in favor of the return of OUR capital!
MEL Price at posting:
6.4¢ Sentiment: Sell Disclosure: Held
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