Alternatively they can negotiate with Macquarie to roll over the notes at the redeem time into the Macquarie debt facility since they are on track to reduce Macquarie debt anyway a win-win for everyone.
The earliest Horizontal drilling would probably happen in June Quarter where the revenue from current production can be used to fund the activity without have to dig into the debt facility. Alternatively they can use the debt facility to accelerate and bring forward that initial drilling. However I prefer revenue based funding for initial horizontal drill if success then debt facility can be used to accelerate more replicate such drilling. That will be less risk to the balance sheet of the company.
In a way it s good the share price is lower at this point that would be less incentive for note holders to convert their notes to share giving time for company to build up fund to take back those notes at redeem time. Alternatively the mob up half of those notes and the rest of the fund use for mob up all the loose shares.
That will add more value to the director's 10M shares so are our shares. He has plenty of time to make the company look attractive to other new buyers out there. Shale is the new gold rush over there in north America, only ASX doesn't know that. AZZ is sitting in the middle of the gold pile so we can afford to take time to pick the buyers.
AZZ Price at posting:
40.0¢ Sentiment: Hold Disclosure: Held
