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12:41
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Originally posted by Luis Coal
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Senaris, that is so obviously wrong.... Debt of roughly 290m AUD will vanish and be replaced by equity. Total company value (=assets-debt) needs to go up at least in the same proportion. Purely mathematically, it will be around 8cts after the conversion. However, there are some other factors to consider here, some of which are positive and some of which are negative long-term:
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As you say, everything is speculation. My take on it is that Mt K want out of Lynas. It was almost certainly never intended to be a long term investment (hedge funds aren't generally renowned as long term investors) and the only way out for the secondary debt holder is to convert at the best price possible so they can unload on the market, albeit at a loss. I think that Mt K can't see any end in sight for their debt and they'll take 30c in the $ so they can move on by trickle feeding their stock as they can. Atm they are getting neither capital or interest, and no clear view as to when they might get either.
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