What is the point of a capital raising, they already have $20m in the bank, but their debt is circa $35m, yet there is nothing in the notice about paying down any debt. I think it's simply a matter of the AISC getting out of control, as per many Aussie gold miners now, they are all finding their costs sky-rocketing and spiraling out of control, for both labor costs and equipment and services. Most of the Aussie gold exploration and new producer stocks are now well under-estimating these costs, and as a result, there are not many that are profitable. Imagine what would happen if the gold price fell back to USD$800, it would literally decimate the Aussie gold mining sector overnight, hundreds of mines would be shut down for years, and a hundred small companies would go broke. For profitable gold stocks now, you need to look to the West African producers, and there is only a few listed on the ASX, but you can also look to the TSX. Australia has become an enormously expensive place to mine.
What is the point of these guys at TUL, they don't provide any mining expertise, they are simply an investment house, who's principals sit back in London and just discuss where they can invest their money. They were savvy to pick up Norseman cheap at the time, but could not develop it, and never would, because they were not capable, so they waited ages for a partner like PNR to come along to do the heavy lifting.
From what I can see, there is only one point to this stock, and that is when they decide to sell their 50% ownership of Norseman and pay themselves an "almighty massive one-off dividend", because the directors here own heaps, and surely that is their retirement plan.
So for shareholders, timing is everything with this stock.
And maybe, just maybe, this new investor has got whiff of what is happening, hence the trading halt.
Gw
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