On the conjecture front we had those in the Blue Corner that...

On the conjecture front we had those in the Blue Corner that said CDU was close to fully funded wouldnt need much more cash and any extra required dollars would be obtained from NCU & DSO sales . Then in the Red Corner we had the realists who said CDU needed circa $100m / $150m to complete the Rocklands project - Its no longer conjecture but the realists have been proven correct. - The Blue Corner also contended that debt was bad with comparisons to Sandfire it now appears that debt is good when it comes to CDU ( a view I personally agree with - debt is better than dilution particularly at the current share price )

Pro's

* To get $105m at 7% without a BFS is a monumental achievement for a $400m market cap company ( Kudos W.M )

* The cash injection will significantly derisk the company against the backdrop of the crazy money printing regime of the GFC 1 instigating Yanks who are doing their best for a GFC 2 encore performance.

* IMO the recent increased level of CDU shorting has been on the back of funding uncertainty - This placement will go a longway towards making shorting CDU a less attractive investment stratergy

Con's

* Security for Minsheng - The Devil is the detail - I expect the funding package would entail first mortgage security over all of CDU,s asset's this would be pretty standard as per SFR and OZL - Cudeco is in the vulnerable construction phase where time delays ,weather events and plant commissioning unforeseen problems are standard fare in setting up a new mine - I wonder if the funding package contains any onerous default clauses ?

* Sinosteel is a Sate owned entity and while Minsheng is supposedly not a state owned entity you only have to look at what happened to SDL when the government dictated the the financial arrangement's re financing the failed take over to know that there isnt really any fully independent private companies in China. The CDU register remains more vulnerable than ever to 51% Chinese control ( IMO )

* Dividends -Look at SFR for a guide to paying down debt I expect the first quarterly dividend cheque arriving in our mailboxes just went back 12 months.

* Port and Rail $$$ does this funding package include the funds for these projects ? a good question for the AGM no doubt.


hOOt