If you cannot make money with Pollies then the business doesnt...

If you cannot make money with Pollies then the business doesnt deserve to survive.

The sale of the US wind farms didnt achieve a good price and reality suggests they were about $100 million at least below what should have been achieved.

Forager Funds was upbeat about the stock in their June quarterly but had this which I took to be a caveat:

"It currently has its US wind portfolio up for sale and a price in excess of US$350m is essential if Infigen is to refinance its debt. Even then, we anticipate a rights issue will be required,"

Then you read that they say they sold these interests for $272 but off that is an $11 million cost of transaction and a 10 million contingent on other matters and it includes the Class A equity. So IFN has to write off $225m Really and then to explain it they say:

"The written down value resulting from the transaction is attributable to a number of factors, including:

• the lack of meaningful near term cash flow for the Class B interests results in debt financing being difficult for a new owner to secure
• bidders adopting less favourable operating assumptions in relation to production and long term merchant electricity and renewable energy certificate prices than those used by Infigen
• bidders adopting their own views in relation to long term operating costs, having regard to the expiration profile of existing service and maintenance contracts."

So either we have to accept our valuations or we are wrong to accept the offer suggests we have had to accept reality of our valuations being more unlikely to be right.

So we are left with roughly 27c TNAV ( assuming most of the writedown is in Intangibles - ??)

Then look to income and really without a rights issue my numbers suggest break even small profit in Australia and only if we can reduce the huge corporate overheads - So really the future relies on a rights issue and more Australian Investments ...

Personally not sure if there is a logical entry point at this time - I think I will buy a small holding if it gets around 20c just to be in the ride if their is a rights issue.

I think this has been a long ride to the bottom for most investors. One question are present management part of the problem? Or is it the greater problem that renewable equipment improves and price drops have occurred that its not a great space to be in - Remember reading that new plant is much cheaper per KWh ... and more reliable ...

Anyone have other thoughts ... This is still an opportunity but IMO management have to be more open about things - I thought that the USA deals were just a wait and see and IFN will get the gold from 2022 - they now suggest that its not so.