It's relatively easy to be critical of Arrium's management/board (re: IO expansion), but I can't help wonder what situation they would be in right now, if they hadn't launched the equity raising late last year? Maybe they knew something about the IO price that other people didn't back then? Was it around $70-$80US/tonne during September last year?
Also what was the IO price back when they went executed 'project magnet'? Although they would have been operating under BHP's contract marketing setup, I think the price was around $40-$50/tonne? Well once they mothball the Southern Iron operation, they are back to where they were after completing that project to release haematite ore from the Middleback Ranges? I'm going off memory here, but I'm confident the company can get through this difficult period, and if they do the SP will take care of itself. It's applying no value to their IO operations anyhow.
Is it worth holding/buying Arrium for their steel manufacturing and grinding media businesses? I reckon they offer pretty good risk/reward right now.
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