the answer lies in the need for the capital raising and ARI will still have $930+m debt,so NOT debt free.
Now the question is do I sell my shares at 35c less commission and rush out and support the capital raising at 48c and end up with even less in the company,taking it below half of what I owned before?
The answer for most shareholders I expect is you must be joking.
Hope the underwriting agreement doesn't have an outer for UBS,or all this capital (Shareholder) destruction would have been for nought.That uncertainty is pushing me towards selling,while i can still get 35c.
$78US-10% discount = $70-cost of shipping $9-$12US = 58US x $1.15 = $66.70 AU/ton plus
call it $70/ton
Last QTR loaded cash cost FOB down to $45.90 plus royalties $3 overheads $5 and wet to dry $2 = $55.90
add $6 exploration and capital expenditure and recovery of D&A..most of which can be curtailed in the current environment.The $100m debt probably relates to the cutbacks a Iron Knob.
DYOR + DYODD I expect that particular uncertainty re underwriting is adding to the exodus of shareholders wondering about the competence of the decision to do this in the first place and the continuing hammering of the share price.Its alright to be 100% underwritten,but what does the actual contract wording say I wonder,and what does the BUT IN THE EVENT OF clause say,there usually is one?
Where could that leave ARI if it really needs these funds?
My current sentiment is I own too many to sell?,but wouldn't risk buying at the current price because i don't see the urgency for this whole funding exercise,when they've run as low as having $50m in the bank in the past,unless somehow $600m has just disappeared.
ARI Price at posting:
36.0¢ Sentiment: None Disclosure: Held
