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Tradehobbs, there was no production. That was the problem, they need A$100m to fix the ponds and the plant, and no one was willing to front up with that sort of cash when there are other potash projects to invest in.
In short, the best option now is the receivers sell the plant to one of the other potash hopefuls, but even they are struggling to raise cash due to this mess. Australian Potash (ASX:APC) is perhaps the most logical buyer geographically, but they've been struggling for 12 months to raise the funds for their own project, and would have to weight buying a plant that doesn't work vs building their own and hoping it does work.
At the end of the day, the plant will probably get sold for cents in the dollar, lenders will have to take a haircut and shareholders will get nothing (unless they are successful with a class action against the Directors).
Does anyone know the chances or if it is even possible if they find a buyer say willing to purchase 50% of SO4 to pay of the urgent repayment debt allowing SO4 to proceed and continue with production whilst still owning a big slice of the pie?
Just curious to hear people’s thoughts on the possible outcomes here.
Spoke with 212 trading team and its still processing orders might have a turn around and find funds by a miracle
Imo, this letter is just for formal compliance purposes, technicality for marking checkbox on their side (especially considering timing of making it public) . It would be hard to expect for anything tangible to come out of it.
It might add additional transparency basis for a possible action against BoD but having it without this letter won't affect the outcome.
Thank you WelshFalcon for ASX letter details. Interesting reading the document. I need time to reflect on the contents because they do imply investors have been wilfully misled ...
If you have a read through Hot Copper's board on SO4, you will find a long thread on a class action some are trying to put together in Aus. Interesting read.
Sign up and add you name if you wish. For me, these things rarely come to fruition, and can be just throwing good cash after bad. I haven't made a big enough loss to make it worthwhile. Some may find a bit of comfort there and like minded souls in another hemisphere!
Thanks WelshFalcoln, a very interesting read and I have appreciated your informed posts. I should have heeded the warnings like you did, there were enough alarm bells ringing and I didn’t act on them. My fault.
However, I do think that SO4 have been at best disingenuous and at worst borderline fraudulent. The ASX letter is pretty damning.
Just a few of the questions they asked-
“1. Does SO4 consider its commencement of First SOP Production in June 2021 to be information that a reasonable person would expect to have a material effect on the price or value of its securities?
2. If the answer to question 1 is “no”, please advise the basis for that view.
3. Did SO4 commence First SOP Production in June 2021 as flagged in the Institutional Placement Announcement?
4. If the answer to question 3 is “no”, please explain the factors which delayed SO4’s achievement of First SOP Production in June 2021.
5. When did SO4 first become aware that it would not commence First SOP Production in June 2021 as scheduled? Please provide details of the time and date.
6. If SO4 first became aware that it would not commence First SOP Production as originally scheduled and advised to the market before the time it requested the Pause in Trade, did SO4 make any announcement prior to the relevant date which disclosed that information?”
And so the letter goes on……
Sorry, forgot to say - this is published today (20th Oct)
The ASX have just published a letter sent to SO4 on 2 Aug. They had serious questions back then, and now see the need to publish them.
https://hotcopper.com.au/threads/ann-asx-query-letter.6363152/?post_id=56948021
click on the 'download document ' link, a PDF of the letter comes in a popup.