fortis friend or foe or what

Tradertcb has raised a crucial issue, with a lot of precedent happening right now. There are a lot of companies going under with good assets who are unable to roll over loans. Sure, most had high debt and low/no cash flow – sound familiar? Lots of banks have gone under, too much lending, not enough capital.

Fact: p39 MAE Financial Report 30 June 2008
(a) The secured loan facility provided by Fortis Capital Corporation for US$25,500,000 A$26,688,157 (2007: US$20,000,000 (A$25,011,981)) has been drawn to US$25,500,000 A$26,688,157 (2007: US$14,866,000 (A$17,512,074)) as at 30 June 2008. The facility matures and is due in full on 8 June 2009 with no payment required until maturity. The facility is secured by substantially all the assets, including oil and gas reserves, of the company’s wholly owned subsidiary, Marion Energy Inc, a US incorporated company. The interest rate applied to the facility during the year ended 30 June 2008 was 10.07% (2007: 8.82%).

>>due in full on 8 June 2009. Not just putting up 10.07% interest which happens to be US$214,000 per month!

Fact: Fortis share price December 2007
Was Euro19.45 in Nov 2007. It has now fallen to Euro 0.62 Euros. Assets have been sold off. SH rejected the election of 3 directors at Dec 2008 AGM, They now have to hold another AGM!

INHO: Chances of Fortis surviving, let alone extending a US$20m loan have to look slim.

DYOR – check out Fortis and share your findings.There seems to be very little current information re the status of Fortis USA.

Fact: p59 MAE Financial Report 30 June 2009
A total of 54,000,000 options are on issue. 5,000,000 options are on issue to 4 holders of ordinary securities. 40,000,000 options are on issue to 3 directors and 6 employees and 1,500,000 options are on issue to two non-executive directors and 5,000,000 are issued to 16 employees under the Marion Energy Limited incentive option plan. 2,000,000 options are on issue to Fortis Capital Corporation and 5,000,000 options are on issue to Mid-Power Resource Corporation.

The bottom line: We need flow rates, a reserve report and a sale by end of February 2009.