Ann: Pause in Trading, page-233

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25/10/18

12:01

Post #: 36256599
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Originally posted by HAC30: ↑

Enterprise value 10x higher than today, please provide your numbers. That is very contrary to Ballieu Holst's numbers, and lets be honest, plucking a figure out of thin air.

Secondly, the financier really isn't taking that much risk here due to the option to convert to equity. If the company cant afford to pay the interest and principal back, they just get greater ownership of the company through converting the loan to equity. If this was a simple 7% p.a. loan with no equity component I would praise the deal. Converting interest to equity is at lender's discretion. Converting principal to equity may or may not happen. Shareholders can reserve the right to vote on it but if the cash-flow isn't coming in by the time it is required, they don't have a choice. Its debt that ranks above shareholders in the capital structure of a company, if shareholders vote against conversion and the company doesn't have other means to repay the note, they just call in the loan (yes I actually understand how these things work as its part of my occupation to do so).

We can go around in circles or revisit these posts in future. Got the same stuff over at AUZ about how good their Con note deal was. " You dont understand"... "Educate yourself"... haha.

I am not saying the company cannot succeed. I am just pointing out the other side of the story and a possible scenario that could realistically play out.

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Spoon feed yourself. Do some peer analysis on producing peers in-country, (listed and private) and see for yourself what their project EVs are.

And in case you cannot read I clearly suggested a market cap in the future on the decision to mining operations with a DFS in hand.

I doubt you can understand Ballieu's model in any case.

Lastly the THE CON NOTE CONVERTS AT VEC's discretion - so I am glad you agree that a 7% loan is great and that YOU are happy with that.
I am sure that VEC's management can crunch the numbers at the time and determine the best outcome in the future.

VEC Price at posting: 1.8¢ Sentiment: None Disclosure: Held
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