-a) Yeah, that is what I thought too @Londoner. We don’t have debt; so it is just creditors. So it can’t really be a major amount…or can it…? I don’t know (can't take anything at face value anymore), but normally it isn’t a major amount and hence normally, an ASX mining company does not go into admin because of routine issues like keeping the light on. Surely, the CR should have covered it, or else the cash management in recent times was even worse than earlier.
Another question is why wasn’t the capital raising fully underwritten to whatever amount they intended to raise – what was it 11 million or something? Why underwrite it to such a small amount of just 4 million? Or was it that they were not able to get it underwritten for 11 million? Don’t know again.
-b) I think Nicanda deserves much much more but like I said, we’d never get the true fair value. True value is best got the way our neighbours went about it - by actually aiming to get to production and trying to obtain financing.
Perhaps most importantly, I don’t have any beliefs that TON’s fall was just pure fundamentals . I had a chain of thoughts in mind when I said one year back that “all TON needs to do is manage cash and debt properly and get to production.” The thought of TON being bankrupted was always on my mind.
But really, most companies which go bankrupt do so because of debt normally. So, going into admin because of not being able to pay routine bills is rather shocking.
Would TON probably be better off trying to raise cash again from old/new shareholders? The sad part is it could mean further massive dilution. We’ve already fallen from around 32 c to 6 c and now admin just trying to raise 4 million.
So we lose both ways unless they manage to get a raise done at 5 cents to pay off the bills. Surely this should have been thought of at least in last few months, and questions have to be asked why this was not thought of. How could it not have been thought of when cash management was already the major issue of the time?
Like I've said many times, I believe TON could eventually have to be "saved" through a UK listing and cash will be obtained through that route, as TON inevitably falls short of cash again. Remains to be seen now if that materialises. Of course, the terms might not be beneficial to TONners who seem to be losing every way. Either way, even if not through a non ASX listing, it could be an ASX one.
-c) Don’t know for sure about JV with GK, but one has to always keep their options and pursue other alternatives. Obviously TON is operating from a position of severe weakness now. I don’t know how 5-10 million will be enough for Ancuabe too, as we are back to zero and might once again have to go in for capital raisings, perpetuating this cycle. The issue is that I don't believe fair value for an asset could ever be obtained in a "distressed sale" position and is mainly possible in a market where that asset class is already booming, and the company operates from a position of strength.
IMO, this was never about graphite but always about cash. Astonishing that cash issues are being ignored again and again.
TON Price at posting:
6.1¢ Sentiment: None Disclosure: Held
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