Yea to be honest trying to understand how they will have 79m of outflows in the next 12 months. Either the ramp up in the megaline is causing them to burn more money and got be cashflow neutral or they are going to invest heavily into a second megaline and will announce a new contract on Monday...
Secondly not sure that 95% redemption rate could be accurate hard to see it go from 70% previously to 95% so room for a slightly better outcome.
Thirdly if it is 95% then there will be approx 25m shares in mergeco meaning the CEF can only be issued 2.5m shares. If in an ideal world it trades at $10 then only 25m of equity can be issued as a maximum. There is still a shortfall of $35m or even more....
So this new advisor needs to find new investors in the form of warrants which will get the funding but be highly dilutive however CBR will survive and that will be good enough to get healthy returns on the investment or CBR will go into administration.
I personally want to believe that the Redemption rate will fall between 85-90% which will get them between 30-45m funding and then the remaining 15-30 can be sourced from the CEF and warrants.
Personally if this rallies to 50c or greater I will be very tempted to take my gain and forget. The future of this company will be dictated by the appetite for investors risk so I am hoping the macro environments keep's getting more exuberant in the next few months.
CBR Price at posting:
23.5¢ Sentiment: Hold Disclosure: Held
