has anyone had a reply?, page-20

It seems to me they don't care about the share price. Haven't for a little while. I tried to contact them during the rights issue. Had just started looking at it. (Missed the cut off for rights unfortunately). I said if I could talk to someone I could help out with the success of the issue by buying a few hundred thousand dollars worth. At that time the shares were around the 70 cent underwrite threshold and volumes were low, 50,000 shares a day or so from memory. I thought they would be interested to talk to me but no response.

In the end I concluded that they had confidence in the rights issue and didn't need help. So I bought the shares anyway with limit 74 and they traded up after that. I still hold those shares although I sold some options I bought on market when the news of more issuance came out.

This latest episode is more evidence they don't care about share price in the short term. If they did, they would have explained the reason for raising more capital. It probably wouldn't be too difficult. The banks will only want to fund the project at this stage, that's still $16m short (from memory, including working capital). With cash flow not due till Marchish next yr, they may be able to get up to 9mths head start on stage 2 by raising cash now. The main point tho is they didn't bother explaining so can't care about the share price.

So again I'm assuming they are confident at the moment. They know they can raise both the debt for stage one and initial equity for stage 2 with no problems. The share price doesn't really matter as they know it till triple or so from here once their producing. They get as much equity as they can for themselves in the meantime. The disregard for shareholders doesn't really matter as it will be forgotten when they hit their new targets.

I'm also thinking they've given up a bit on shareholders who have probably done nothing but complain since they started missing targets. They realise that retail investors, at least, don't trust them much at all. That may explain a little their actions. Why talk to people who don't believe you anyway. Of course, it doesn't excuse them, I can understand why holders are very angry.

Its a very unusual situation. Perhaps my explanation is a bit generous. But it seems to me they must be confident they'll be producing soon so I think I'll stay in for now.