Iron Ore Price, page-138

If the Chinese were to wipe out half the debt with an injection of funds though, that would come with massive dilution of shares. Current market cap = $6.2Bn, half the debt = $5.5Bn, so an injection of that magnitude would instantly almost double the shares on issue. The injection would most likely be done at a big discount as well. Any profits then would still have to pay out the remaining $5.5Bn in debt, but anything left over would be split amongst twice as many shareholders.

I agree that is a possibility, and it may end up being necessary for FMG to survive. But it would limit any potential upside for shareholders. Not wanting to ruin anyone's party, I've been there before, in a stock that keeps sliding. The economics of their debt burden and the supply glut for the next couple of years though makes this look like a slow train wreck to me. Of course I could be wrong. There have been times however where I've wished someone had pointed out the cold hard numbers to wake me up to a logical decision to sell. When I run the numbers on this stock it looks very bad, the terms of the re-financing suggest that they were just about to run out of cash. I await the annual report to see the true state of their finances.

All imo, dyor.