IMO this is great news for Strike. My understanding is that most convertible bonds for exploration companies are set at a fairly small premium to the existing price (and certainly not 250%) which means that if it goes through Gallagher obviously believe that the "true" value of the company is north of $2.00.
Additionally SRK already have a significant pool of cash so will not need to draw down on this facility for some time to come - so no interest to be paid on the loan in the near future. This just provides any potential investors reassurance that the company has significant backing and a nice line of credit if needed.
Don't hold at the moment but as soon as the price finds support I am going to be in for sure - assuming no bad news about the D&C issue.
SRK Price at posting:
78.0¢ Sentiment: LT Buy Disclosure: Not Held
