Says that of the planned $500M float, which CFE is to keep 25%, that TS wants to take $250M of the table much of which will be earmarked as a special divvie or cap return for existing shareholders.
If I read this correctly, that means that $125M would be left in the company. However, since it is divesting 75% for $375M, does this mean that this is CFE's capital contribution for future raisings? Anyone know how this works? I would have thought that if I sold $75% of an asset, there is no requirement for me to put any of the proceeds back into the asset, unless it is as a loan of some description. Appreciate people's thoughts.
One drawback is that the article says that investors would know that they would need to raise more funds down the track. Not really sure that this is such a drawback if they believe the value will appreciate as they get closer to production though. Suspect that is why they are speculating that $175M would be left by CFE.
Also said that Ambrian Capital no longer required as adviser for the float, so looking at getting someone new and that RBC cap markets and Renaissance Capital are the lead brokers for the float.
CFE Price at posting:
54.5¢ Sentiment: Hold Disclosure: Held
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