boppy, the CIFI raising is not for EHR. The CIFI raising is for the subsidiary company, Copahue Geothermal SA. I can see a lot of incentive for Argentinean investors to participate in the CIFI raising, because it will mean that future dividends remain in Argentina rather than being expatriated. I wonder whether the Argentinean Government is planning to participate?
I am struggling to see what's in this deal for holders of ordinary shares, however, because it looks to me as though the only asset we own (Copahue) is being taken away from us. Please tell me I'm wrong here.
I know that EHR is still the parent company, so theoretically we will still own Copahue. I'm not sure how it all works, though. I mean, if we own Copahue Geothermal SA and preference holders have $30m equity in CGSA, does this mean that a minimum valuation for EHR is $30m?
Either way, I don't think that our low share price will have much bearing on the CIFI raising. I'm sure that CIFI are pointing out to potential preference holders that investing in CGSA will mean that their investment is tied to the Copahue asset. If they choose to transfer to ordinary EHR shares, then their investment will no longer be tied to the Copahue asset.
All is my opinion only. I'm struggling to understand what the CIFI raising means for ordinary holders.
EHR Price at posting:
0.4¢ Sentiment: Hold Disclosure: Held
