Don't be too hard on LG they ahve aleady advanced funds to SBL on what appear to be quite generous terms (but I still can't think that there has to be a catch somewhere).
From July 27th Announcement:
LOAN FACILITY
Signature Metals Limited (ASX: SBL) (“Signature”) is pleased to announce that it has today entered into an intercompany loan facility with its 76% shareholder, LionGold Corp Ltd (“LionGold”). LionGold will provide Signature with up to US$11.0 million in funding. Advances are not repayable before 5 years, except in limited circumstances, with interest at 6% only commencing after 3 years. The facility is unsecured. LionGold has advanced US$5.38 million to Signature under the facility to date.
Funds drawn under the facility will be used for working capital purposes.
The funds are interest free for three years and then at only 6% after that.
Also as far as I understand LG are limited to a 3% creep in ownership in SBL every six months, unless they make another general offer for all outstanding shares that they do not own.
And a further point to note is that LG really have to be seen (by their shareholders on the SGX) to make a go of SBL as the recent management changes appear to have everything to do with LG's first few gold aquisitions going down the tubes.
Cheers
U.Plodder
SBL Price at posting:
0.8¢ Sentiment: None Disclosure: Held
