You get a GA for that Billy... I agree it just business.IMO the...

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Rhino1963

2,804 Posts.

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19/03/20

09:05

Post #: 43574344
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Originally posted by billyen: ↑

In the last MEP PREZ-the end of Nov....Andrew (MEP's MD) said ADN’s
Enterprise Value is $62m- This of coarse was based on ADNs SP.

Now?
it's lower...Andrew could also try and value MEP's last 25% at the SS's NPV...which I think was 413M...soon to be much higher.

However, MEP has to PAY to play in those valuations.
They MUST come up with the 25% of CAPEX/OPEX.

So far that looks to be $2.25M
They currently have a tiny 9M MC...and burn cash at a healthy rate for their other KEY projects.
Hey, if they can come up with the funds...all the power to them.
I just don't see their SH's ok'ing a 35% dilution CR.

They LOVE their other projects/JVs too... Jericho/Windsor.
their mgmt. like big salaries...somethings got to give.

Again, I'll repeat...if I'm Andrew...I'll take some cash and 8-10% of ADN.
However, James has some leverage and he just might use it...and try for only 6-7%...or more cash and 5-7% of ADN?

*James "could" play REAL hard ball...spend another 3M...get to the 75%...then say...sorry, we are going to focus on our 100% owned Mt.Hope, as that's the best deal for ADN holders.

If ADN becomes what we all believe...MEP will get a massive payday.
If they don't like Jame's offer...they simply need to folk over 2.5M...and the get to keep 25% of Pooch and Camel Lake...

Look as the potential ADN casflow...ADN will become a cash beast with it's crazy low CAPEX/OPEX.
*And let's not forget that 37M tax credit boost the first 100M in sales.
(You just don't find stories like this that often on the ASX or anywhere really.)

It's MEPs call.
MEP's low MC and low cash balance isn't ADN's problem...MEP signed the deal.
They sat on the asset for 10+ years
James was their JORC PM 10 years ago and told them what they had...they said no then.
(Then 2 years ago...They signed which I'm sure they thought was a great deal for MEP at the time.)

I have no pity for MEP...it's SHs voted in their mgmt. and this is what their mgmt. did.
Andrew has been running MEP for 10+ years I believe.

It's just business.
MEP will need to make a decision soon.

IMO
DYOR!!

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You get a GA for that Billy...

I agree it just business.
IMO the project will just keep rolling forward and MEP will have to make a decision at some point based on options available to them at the time. I hope JM is thinking about the timing of when the funds are required from MEP in the best interests of ADN SHs. e.g. to minimise dilution...

Have a good day

Last edited by Rhino1963: 19/03/20

ADN Price at posting: 2.7¢ Sentiment: Hold Disclosure: Held
6 Upvote

0 Great analysis

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