Paladin Energy: from market hero to administration, page-29

Restructure 2 was based on the hope that LHM would have adequate value whereby full buy out by CNNC would then provide the funds to pay out EdF, Ned Bank, even 2017 bond holders and other immediate debts. The required percentages of agreement was given by all bond holders for that restructure. Under those circumstances you think that EdF would have been patient enough until the 20/7/17 for consideration of the independent valuation of LHM. The debt call in by EdF shortly before the valuation has been completed has forced PDN technically into insolvency. This may allow CNNC to get out of their agreement with PDN to comply with the valuation for buy out of LHM. None of us know the details of the agreements involved. There may be clauses which give CNNC first option to buy PDN at any cost under circumstances of liquidation. I had heard of valuations last year as low as $150M for the remainder of PDN while another respected firms says $800M plus. It is generally considered that $500M may not be adequate for survival considering total debt. There remain other options which I have previously suggested and if all players had so far acted in the interest of PDN and its stakeholders, survival would been already assured until late 2019. If PDN was able to clear its immediate debts by restructure 2, it loses its current sole source of income from LHM but avoids the continued losses in running it. PDN would have the breathing space and enough in the bank to survive until Kayelekera (a liability at resent spot price) can be made profitable. PDN has assets of potential worth should the uranium turn around occur. Take over would become more attractive with debt significantly reduced. The valuation is due shortly and KPMG will have soon assessed the possible outcomes. It is a long shot, but should PDN survive, it will probably sit quietly like several other hopefuls awaiting the predicted revival in demand for uranium.