The interest rate of the refinancing money is 16% plus after all the wriggles have been taken into account.Seems expensive,compared to the existing rate? They have indicated its for refinancing,is it?,the existing rates are cheaper by far?
It may end well eventually but doesn't excuse the fact that the BoD has been complicit in the painful decline of the sp in the first half of the year which appears to have culminated in the placing/loan at a rock bottom price for some shady parties.
The pi's have been the ones suffering while some shady loan sharks get bargain priced shares. So far every placing done by RC has been sub 100p and I bet the new share options will be too.
Refinance means they must have 'repayed' the $80m + interest+ costs they borrowed to the previous lender by borrowing/placing new shares with a new lender. I didn't mean they have payed off the $80m loan in the conventional sense.
Who knows how much of the previous loan they have left. I somehow doubt they had much more than about $15m remaining judging by the annual results statement where they stated they had about $22m net cash .
You could be correct but the RNS says: “The net proceeds from the bond issue (the "Bond Issue") and the private placement of Shares (the "Share Issue") will be used to refinance the US$ 80 million, 12.5% unsecured loan notes, due 25 December 2014 plus accrued interest and related obligations, to service interest payments under the Bonds, to fund the Bentley field development work programme through this year, prior to submission of the field development plan, and for general corporate purposes”
Key words Refinance the loan not repay fund work programme through (this year), prior to submission of the field development plan
They borrowed $140m to pay off the existing $80m loan + interest which may be about $10m on top of that. They will be left with about $50m or less for on going running costs. This is not $140m all to spend on pre-production as many are thinking.
They only re-negotiated the loan at the start of this year so another refinancing of the loan means only one thing..The very real possibility that the FDP won't be ready by this year end...poor show yet again.
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