only 125m blowout, page-8

It is bad because there seems to be no debt funding covering any of the blowout. I thought this would be fairly obvious. I'm glad you enjoy being diluted even further. Given the company is trading so low we will all be heavily diluted, again. Dilution = less EPS = lower share price for our proposed 10mtpa operation. I was hoping to see a 70/30 D/E to fund this, some here even speculated that it would be 100% debt financed... The positive is that the blowout was inline with the previous announcement, that is all. An equity raising at 80 cents means the number of issues on issue increases by about 40%, whats positive about that?

In simpler terms:

Say NPAT was $233m in YE 2013, EPS = 25 cents @ 932m shares = $2.50 SP @ 10 PE

*add 371m shares for blowout*

EPS = 17.8 cents @ 1303 shares = $1.78 SP @ 10 PE.

Understand? Of course this is rough and doesn't take into account the interest expense for the option @ 932m shares, however it would be in-material anyway.

Iron ore prices are high i'd rather see this debt funded and capitalise on the high iron ore price to quickly pay down the extra debt. It seems we cannot get any extra funding, which I imagine is due to the tightening of credit by China.

GBG completed an equity raising to Ansteel @ 85 cents during the peak of the GFC in 2008 now it looks like we are about to do the biggest issue yet and at a lower price. Would you be happy about that if you were a long term holder?

I'll participate in the raising because it should still make me money. I need to update my model for GBG when I have time.