BRL (ASX) Ann: Court of Appeal judgment released

Originally posted by xmanrocks: ↑

Had a closer look at what the final bill maybe for this debacle.
I have allowed a total of $5m for BRL's layer and other expenses related to the lawsuit.
Same for L&M $5M which the judge indicates BRL must pay 80% of.
For totaling interest cost I have used BRL's production numbers that indicate to me the trigger point for the $40 m USD payment was mid 2015 and payment to be made made mid 2020 so 5 years........interest at 7% compounding
So $40m USD @ current exchange rate........$66m NZD
Interest @ 7% compounding for 5 years = $16m USD convert to $26M NZDL&M court cost $5m BRL to pay 80% = $4m NZD
Total owing to L&M $96m NZD.
Add to this BRL's own court cost of say $5m and managements wonderful decision making has cost SHers approx $100m NZD.One should also consider the company has already outlayed $35m USD for this asset and only about 34000 tonnes has been sold.
I will explain later in this post why I believe they will never use this asset

Really really hard to comprehend how BRL management indicated , several times over a number of years, that they had triggered this payment then decide to go to court to fight against paying it.
But they did also defend.........
Conversions of the RCPS which essentially to me appeared to be an unnecessary conversion of shares at a 90% discount to market value(including all directors as beneficiaries)
Decided against other tabled financing options offered to them but did not disclose what they were to SHers.
Openly disagreed with their auditors causing the auditors to resign.(my understanding this was to do with the RCPS)

Whilst some would argue this is all in the past one could also easily see a pattern is forming.
I would think going forward some investors will find some solace and respite in the fact that Talleys have equal say in the export business but I think this is a double edge sword.
Given the above events it is very hard to comprehend why some investor can't/don't/won't understand why BRL shares trade at a discount to their peers.

I look forward to investor_jackson update on his fair value on the company....the last two have been substantially over what the market was prepared to pay with lots of commentary about more upside.
Of note the SP has fallen 60% in the last year.

On the face of it, at the time, the deal to buy solid energy assets looked to be a master stroke.
However it appears to me by doing that deal combined with the court case whereby they appear desperate to get out of the L&M deal(at any cost) and now chasing a joint venture in Canada BRL are are essentially wanting to walk away from L&M assets having already paid $35m USD for it and now on the hook for another & $95m NZD.
I don't think BRL will ever have a balance sheet big enough to further invest in stockton, as well as the escarpment(L&M) and the new Canada joint venture so I think it is fairly safe to say especially given BRL's actions they may will flush another $95m NZD down the toilet and will probably never get a return on this court enforced out lay.

Not withstanding the company's actions, balance sheet and that the permits for this area run out in 2022 (I believe) I would like to hear from those on here who somehow believe with reasoning that they will get a return on the court loss funds as perhaps I am missing something.

Not helpful having a labour government that openly appears negative towards mining.

Expand

Just a small correction

They have already outlayed $40mUS

I think your missing the initial $5m payment

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(20min delay)
Last 80.0¢		Change 0.005(0.63%)		Mkt cap ! $153.0M

Open	High	Low	Value	Volume
80.5¢	81.0¢	79.0¢	$9.941K	12.48K

Just a small correctionThey have already outlayed $40mUSI think...

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