Ann: HCH to undertake a Capital Raising by Private Placement, page-64

While I’m just as disappointed as everybody else, I have to say “the whole point of cash raises are to raise cash“. Period. You try to do so at higher prices. If you cannot, you have to offer a discount to get money in through the door - just as HCH had to do from a position of weakness. As quite a few had observed before, cash was bound to run dry. It was only a question of time, late Q3 or sometime Q4. The strategic mistake management has made post Osisko deal was (1) to “promise” no further CR and (2) not raising enough capital as was realistically required. And this CR now is the price to pay for that mistake. It sucks, but it is what it is. Now there are 2 options left: (1) call it quits or (2) buy in more at $1 to avoid further dilution. Tough pill to swallow if you don’t have extra capital lying around to participate.

Also never forget this is an illiquid 5-yr forward trade on the copper cycle. It’s a difficult trade to make. No easy returns. It can be a dog for a much longer period of time to come and then suddenly become a hero trade. The timing is totally unpredictable.