I am sort of in your camp, Undies, in thinking that Spartan...

I am sort of in your camp, Undies, in thinking that Spartan could have been moving towards production (though not as vociferously and oft argued as you). But that inclination was on the basis that Spartan is/was a pre-revenue one-asset business. My understanding is that pre-revenue one-asset entities should head towards cashflows like turtle hatchings make for the ocean.

So, assuming Spartan is swallowed by Ramelius what should the strategy be for Dalgarana? On the one hand Ramelius is an amply funded multi-operation organisation that has the capacity to carry a pre-revenue Dalgaranga until it is fully drilled out. As plough and others have stressed, by moving into production at a rush increases the risk that the mining performance is not to expectations. Ramelius has the advantage of being able to devote the time to cross all the t's and dot all the i's (just as they seemed to do with Penny). On the other hand with Ramelius having a near-ready 2.5Mt mill at Dalgaranga and with their regional reach they could relatively quickly bring the mill back into operation by filling it with ore from various stock piles and open pits while they worked towards going underground. Either way, Ramelius the mining house has much more options than Spartan have.

On the point of the Zep saying that Ramelius had no intention of trying to take over Spartan I think that at the time he said that he was being truthful. In my view both Tembo and the German consortium held blocking stakes and while either of those blocking stakes were in place it would have been pointless for Ramelius to try to take Spartan over. However with the subsequent German consortium decision to sell their block everything changed and Ramelius can now have a clear line of sight to taking over Spartan.

Regarding the $175m revolving debt facility that Ramelius has taken out, I've not read any analysis of it, but I think it is coincidentally or not in the ball park of what Stage 3 of Edna May might cost (I think the last estimate I saw was Stage 3 would require about $150m capex). It is revolving, which means it can act like a liquidity diaphragm - not an attribute necessary for a single up-front payment for a block of shares for instance; it is corporate not project so while the banking syndicate probably knows its intended use it is not tied to the one project; and it can be extended to five years, which is about as much latitude banks tend to give speculative ventures such as a miner. I'm at best a bush banker but it looks to me an advantageous deal, depending of course on the rates charged and whether Ramelius will be required to aggressively hedge. I also think using a syndicate is prudent as I still remember the bastardary of the Commonwealth Bank during the GFC as it threw viable mining companies to the wall by pulling their loans.