GNS 0.00% 16.0¢ gunns limited

BrigeBaron,No, I am not a journalist at all. I am a member of...

  1. zwu
    2,452 Posts.
    lightbulb Created with Sketch. 9
    BrigeBaron,

    No, I am not a journalist at all. I am a member of this forum for many years. You may check out my previous posters especially under GNS and GTP to find out who I am.

    Quote, "It's not at all like a loan, because of the risk."

    Only superficially this "divestment" is not a loan, but (as I said) in essence it is.

    Quote, "Now that they have sold the trees, the risk of the asset being destroyed (by fire, for example) is carried by the new owners."

    If the trees were not insured against fire by GNS already, the fire risk premium would be reflected in the deal, and GNS "divestment" proceeds would have been reduced.

    Quote, "Also depending on the contract of HOW they are going to buy them back (e.g. has a price or a pricing formula been fixed?), the "interest" as you call it, is not necessarily known in advance."

    Because of this uncertainty, GNS also had to pay a risk premium in the deal and make the potential "interest" payment much higher than normal.

    Clear enough, no company will make such "divestment" deal unless it's desperate for cash.
 
watchlist Created with Sketch. Add GNS (ASX) to my watchlist

Currently unlisted public company.

arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.