IMO, the ASX are away ahead of us in their analysis and we have to decide on what outcome that would benefit us most -that CLi returns trading backed by the Atlas deal (massive dilution for retail shareholders) -that CLI is de-listed by the ASX (We'd be at the mercy of the board without ASX regulation) -that CLI is put into administration but remains listed on the ASX -that CLI is forced to declare bankrupsy -that CLI lets Logical Cropping go bankrupt* in the USA & plants a small hemp crop in Aus etc. (100 acres of trimmed flower for export to the USA could be very profitable, IMO. 100 acres could produce 60K lbs of trimmed flower & say $250 USD/lb -total revenue of $21 mil AUD)
From those possibilities we have to decide which would suit our interest best. There are essentially 2 paths to recovering some of our losses, IMO: -(a) that CLI is kept alive and over time so we may be fit to claw back some value via the strategy beloe (+ the possibility of litigation) -(b) that CLI goes bankrupt & shareholders loose short term ( + the possibility of litigation)
There are arguements for both (a) & (b) but I'm inclined to favour (a) which means that I dont favour too much shareholder action which might tip CLI into bankruptcy or administration. IMO, if CLI declares bankrupcy, the current board & management could pick up the pieces at firesale for two bob. Again IMO, if CLI has an administrator appointed, he/she will likely firesale assets, (if any given that Atlas nearly owns the lot) and then wind up the company.
*NZ Airlines did this with Ansett in the late 1990's and it did not damage NZ Airlines!
My preference is: that CLI bankrupts Logical Cropping in the USA (this would cancel the Atlas & US harvest debt) and position CLI to grow a small profitable hemp crop in Aus in 2020. This option would have the lowest dilution & potentially the best outcome for retail shareholders. A hundred acres of trimmed flower would likely cost $2 mil and the loss of the hi-tec irrigation system would not be a great loss because it di not produce the targeted biomass or CBD in 2019.
Atlas took a commercial risk and securitised that by putting a blanket lean on CLI's assets. Virtually all CLI's assets are in Logical Cropping and even if CLI has to forfeit its Crop Logic irrigation systems , that would not be a monumental loss, IMO.
All IMO, only and shareholders should consult a professional before taking any action in these issues.
