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Colonel drake - Loving the idea of getting diamonds for my Petra shares instead, at least I can do something with a real diamond . Yes from my experience you can always hold real diamonds as a long term asset , which can be passed down generations without inheritance tax !
On a real life note , I know diamonds have taken a big cost hit. My dealer in Hatton garden is trying to sell me diamonds right now at extra 25-30% discount right now just for him to keep afloat, but alas he won't take Petra shares instead .
i wont be doing anything with my shares first hour, thats when most get fleeced
Some investors seem to think the SP might rise on Monday, more chance of pigs flying
Hi Regbob,
"and so management should return shareholder value...after all it was because of shareholders, the opportunity for growth was allowed"
Totally agree, but you'd be surprised how many other companies do this in the situation Petra is in. In the event of administration, bondholders and lenders will get paid before shareholders.
"We also should have time on our side."
The covenant ratio for 12 months to June 2020 set by Petra's banking facilities was 3.5 Consolidated Net Debt to Consolidated EBITDA.
We all know Petra has breached this covenant and would have been under administration.. had it not been for management to negotiate with lenders etc.
This is essentially the "time on our sides" created by management.
I am also a holder, albeit a small holding gamble. I do feel bad for long term holders, but the risks to this business was provided back in 2019, when positive cashflow was offset and when the SP tanked..
I hope we all can gain SOMETHING back from this sale.
GLA.
Hi GreenKitty,
I understand that you're frustrated and upset about the performance of this company. But I don't think this is managements fault. I think Richard Duffy has done a great job from negotiating with lenders, to trying to turn this business around with Project 2022.
It's just unfortunate that coronavirus hit when the diamond prices were already under stress. Even now, management is trying to return SOME shareholder value by trying to sell the company and/or assets...
I think Petra was in trouble of administration when it first breached the covenant ratio with the lenders. So kudos to Richard Duffy for keeping the company afloat and trying to return some shareholder value.
All IMO.
So mentally yes I was upset that I had to write off loss of my original £24.5k investment this weekend, it might not be alot to some people here , but ouch for me in my portfolio .
But hey if I get anything back then that's better than nothing IE. If I get back £4k , thats much better than the £2k it's worth if I sold today .
Imo - Better not to get too excited until more news appears of any actual real buyer? . Also acquisitions can take anything from 9 months to over a year to complete , so more volitility expected for this share price based upon rumours and speculation until purchase is completed.
Also any official RNS will likely be very basic in details , just enough to ramp up interest/ hope to keep share price from falling further to help the sale? . Personally I'm not feeling very confident that Petra management actually share the truth, since this announcement late Friday, seems to have come out if the blue, without any input from shareholders? .
Good luck all - DYOR
I have been holding very reluctantly hoping to just get out at breakeven or little loss even losing 20%.
I was hoping that the firm would have improved since they began to implement strategic changes . All talk about a project to drive efficiencies and generate cash , they called it a so called success ?
See the last article report at beginning of June 2020 which claims improvements via special 2022 project was executed to free up more cash . But now blaming covid for their failure , even though looking at share price in January 2020 before crash it was not improving.
So the question I have is why are these people still in charge? Within 1 year share price is down now to 2p?
I'm my opinion only, even with a RI issue which most companies do first to raise cash , might not be enough to help, hence no option but to jump ship and sell. Cullian mine will be cherry picked off first as it has most raw blue diamond potential and largest asset . Rest of the other mines are breadcrumbs . So they would loose the crown jewels to try to keep afloat ? .
Below in my crazy theory logic :
It will be a cash buyout at ridiculious cheap price likely Chinese firm with deep pockets, who will sort out management problems quickly ( fure them all hopefully ) . They mine and then have their own raw commodity base, so will not have to import as much from other global sources, then control internal Chinese consumer market? . Chinese will want to expand their self sufficiency, just like expanding into oil and gas or currently exploring methods to change dessert lands into environments which can be changed to agriculture for the future.
Article link mentioned above :
https://im-mining.com/2020/06/01/petra-diamonds-project-2022-initiative-provides-bright-spot-in-latest-interims/
Out of interest, were you thinking there may be a time where the share price rises enough to get your money back or has it been damage limitation for a while?
Likely the company will take first offer on the table from any buyer as the debt clock is not going anywhere fast, so they won't have time to court the market properly. I won't be selling on Monday or buying more as that would not help my already high average price of shares- throwing more money down a pit.
So I will be just watching and see if I get anything eventually in next few months for these shares, whether if a buyer can be found. IF no buyer can be found then shares = £0.000 , debt banks & administrators will take the lot and us shareholders are always last in pecking order to get any money.
Likely some may buy on Monday to ramp up share price, then jump ship as soon as they see any mini profit, but not bothered about the future of the company itself. No judgements here as to how people wish to spend their money / trading strategies . As always people need to DYOR and do what's best for them.
I have been holding £24.5K worth of shares at 22.53p average since last year, so I am currently looking at a minus 90.37% loss at the current share price. I was hoping for the long term in a recovery, but now even if a buyer is found I might as well kiss this investment goodbye . Not deramping - but a reality check for other investors that this share carry heavy risks , but I never thought this one would crash so badly, hoping that I'd have to hold for few years.
The new buyer can hold long term and reap the benefits of the diamonds within the ground . We just have to see how much a new buyer wants to pay out to current loyal shareholders within the next few months.
I say at least months for a new buyer, as I doubt in this current market that anyone wants to buy a mine, even if it is going at such a cheap price. Even if they find a 20,000 carat blue diamond tomorrow, not enough appetite in current market for people to buy diamonds ( see by recent auctions the big houses have tried to trade at miserable results)
Good luck all as we need a miracle of luck to get money out of this rock now !