I have just finished re-reading the Annual report for JUNE 2008. Its interesting to read it again in light of current circumstances. Here are my thoughts for what they are worth: 1) It looked like management assumed funding was all finalised subject to satisfying certain conditions. So their main emphasis appeared to be focused on operational issues; 2) The bankers are all off-shore and we know they are under extreme pressure in their jurisdictions; 3) Funders have taken a severe haircut in terms of issue price of securities. They are sitting on big losses in respect of this investment. Do they double up or cash in their chips? $64 question; 4) As bankers do they will seek all available avenues, fair or foul, to get out of their funding arrangements - if they succeed, well lights out; Perhaps LYC can renegotiate deal, but if they do its probably going to mean existing shareholders will have to take a haircut, as the bankers will surely be wanting their money back. Clearly doesnt appear to be good news. The question to be answered by management is did they use their best endeavours to secure funding? Time will tell.
LYC Price at posting:
19.9¢ Sentiment: None Disclosure: Held
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