Australia's largest stock trading and investment forum Australia's #1 stock forum

G79

0.00%

2.7¢ goldoz limited

Possibly, but all the evidence points to Arena telling NXE not...

First 8 Last

Share
Profile

Follow
Davisite

19,096 Posts.

5902

01/11/18

12:47

Post #: 36350625
Share

Originally posted by RFC1873 ↑

Originally posted by Davisite
I think Arena has informally told them don't ask for anymore cash. Arena like me were in MUS for the ruby story and when that went I think they went. Why would NXE be looking around for a cornerstone investor if they could draw on the Arena CN? Arena is there in name only.
I respect your view, however Arena are in the financing business and the economics of the Vanadium - Graphite project simply put the Ruby business MUS were chasing to shame.

Arena were supporting MUS for financing purposes alone, irrespective of the asset class as they weren't really going to be making any money off the ruby sales were they? Please correct me if they were. Arena's most recent $20M funding came after the ruby auction failure.

In my view Arena are / were simply looking to charge above mark rates for finance with the possibility - and this is pure speculation / opinion on my part - that a failed MUS business would allow them to access some seriously valuable tenements to flip quick. That's a stated objective in Arena's structured finance division.

I think the reason NXE have been waiting is because they've stated they want an equity + offtake deal. Apart from lower financing rates, it also brings customers to the party that have some skin in the game and not leave every aspect of mine development and delivery up to NXE to deliver. NXE might as well try bring in some customer expertise if they can whilst simultaneously securing sales and funding.

That seems a better prospect than having a wolf in sheep's clothing waiting for you to fail.

Of course - as an MUS holder I've lost so much faith in the company that even if I personally handed them the $7M in capex they need, I'd still have my doubts.

Expand

Possibly, but all the evidence points to Arena telling NXE not to draw on the CN. In theory they have enough money from Arena right now to build the pilot plant so why are they running around trying to find an off-take partner for the project? NXE would not be in a halt if the Arena money was in practice available.

Arena is probably like all the investors in MUS/NXE somewhat gun shy of the promises of the board. I do know from what CJ told me that they were very interested in the rubies as it was an unique asset.

NXE Price at posting: 7.3¢ Sentiment: None Disclosure: Not Held
Upvote

0 Great analysis

Reply

Top Stories

Revolutionary inverter technology leads the clean energy charge

From the Floor with Kim Beazley at Diggers and Dealers 2024

From the Floor with Federal Opposition Leader Peter Dutton at Diggers & Dealers 2024

Wealth Within: Why the stock market isn't going to crash and more with Dale Gillham

RBA keeps rates steady at 4.35%, reflecting expectations