This is somewhat old news and already well "cooked" into the share price. Twiggy is not an idiot and would be reticent to be too aggressive in action against any of his debtors at the risk of reducing significantly the value of his various financial loan assets. Creditors haggling over debt caveats, hardly unsual. And if you are reading it in the AFR and then predicting doom and gloom you're rather shutting the gate after the value horse has bolted.
This company was cooked a long time ago. Its whether there is some decent recoverable flesh on the carcass. Hence HAS trades at a $50 milion mkt cap rather than the near $500 million it did in 2022.
Just a bit of public posturing ahead of legal wrangling and debt renegotiations. And even it the AFR's gloomy discounted shares for debt scenario does, in all unlikelihood, eventually play out (the value of Hasting's 21.49 per cent stake in Neo Performance Materials is indeed compelling as AFR itself points out) then longer-term HAS left with a large Forest equity investment that is hardly going to damage its longer-term business prospects. Short-term valuation loss for shareholders for longer-term stability.
The China bashing is a bit boring. So many forget Twiggy himself went to China for backing in similar fashion to get Fortiscue's business escaping the heavy gravity of poor capital financing in Australia in the 2000's and then had to repel more aggresive staking from the Chinese in defence subsequently. He knows better than anyone Hasting's cost and capital dilemas to remain a going concern, as its creditor, and likely anticipated them (perhaps not quite the poor handling) when Wyloo granted the debt.
Just like Twiggy didn't have any reasonable Aussie options in the early 2000's nor does HAS in rare earth processing outside of China in 2024! Be realistic guys.
This is a $5 million debt. Wyloo is hardly going to denigrate its own $150 loan asset over terms on a $5 million loan. Twiggy ain't stupid and nor is the NAIF.
HAS Price at posting:
28.5¢ Sentiment: Buy Disclosure: Held
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