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I appreciate all the doom and gloom about the going concern point, but they were obliged to say it by the AIM regulations. The amount they need to raise to survive (ie pay suppliers and first tranche of debt) is a few million. There are plenty of indivdual private investors that can afford that even. It's a rounding error to the Newfoundland government if it saves jobs (esp after Hurricane Fiona). With enough to limp through the next few months, they could manage their cash properly this time. The share price would rise and then a placing would be more reasonable.
The CFO has moved to Newfoundland. She is not going to move back home after a couple of months. She will plot a path.
The company will need to raise more than a few million.
One of the main problems is the very large negative working capital with current liabilities of $28.5m and current assets of $8.5m. The company has said that this needs to be dealt with by raising fresh funds so I would have thought $10 to $20m is required.
The company is experiencing problems paying it's drilling and mining contractors at the moment which has resulted in a falling production (see guidance). There is a risk that the contractors will stop operations which would lead to a suspension of trading
For someone said they wont be posting here again until the next RNS .... you're posting an awful lot!
Morning dj, what on earth has happened here!? I was invested a while back when the SP pre consolidation and it was back on my radar at this level of mcap given the assets. Even at this level it is an almighty gamble and in today's (unforgiving) markets for small cap mining companies I'm going to sit tight and watch how things develop. Hope your other investments are making some money.....
I am not sure how people know what exactly is needed. ÂŁ10 Million, ÂŁ20 Million, ÂŁ50 Million and even ÂŁ290 Million. Noone actually knows exactly what is needed and how much! You can all guess, but it is all speculation until we hear something from the BoD it's all speculation! The refinance could go a number of ways and not a single person on here knows what will happen!
Taken from the RNS:
Based upon the board's discussions with the Company's brokers and debt funders, the Board reasonably believes that it will be successful in securing the necessary required fundings.
Again, taken from Toby Bradbury’s statement at the end of the RNS:
The need to bring capital into the business is to ensure that long-standing legacy commitments are met and not to support on-going operations. The current drop in copper price is one which we believe to be temporary, but we also recognise the volatility in the market.
We are in discussions with all relevant parties about the need to restructure our liabilities and believe that practical solutions will be found all round…
One thing I noted for myself was that at no point in the RNS do they re-assure that any potential solution will not negatively impact PIs. They treat PIs as cannon fodder.
Yes AJ, all speculation
And bloody well shouldn’t be speculation
Especially after those two bloody car crash RNS
I do agree that the first one was a pointless RNS, and I will be honest I am not sure why it could not have waited until this RNS! I do see a lot of positives from this RNS and when they get funding this will fly! This is a will be profitable mine and has the potential of 20,000 tons! With a life span of 15 Years!
To me the case to hold a position in rambler, is different to the case to invest or add more in rambler today. So discussion on these are slightly different points.
The case to hold an existing position is now more about if you think the material going concern risk will be mitigated, resolved and sufficient for the needs of the company during any recovery. It's a business case and ongoing concern decision.
While the above is still a fundamental decision someone would need to determine before investing or adding, the case to buy or add today is different. I say this as once someone finds an investment that looks good, the next stage is to time entry.
So personally I wouldn't add or start an investment in rambler today, even if I felt their is an investment case. The fact an equity element will be part of financing is likely to mean, but doesn't definitely mean, lower opportunities in the short term.
No one knows how much is needed is true but it will have to be significant. Ideally it would have been sufficient for capex to implement more efficiencies at the mine but this, sadly, doesn't to appear to be the plan.
It will however involve equity and the nature of the equity is critical IMO. Most probable is a discount to prevailing price, to hopefully avoid a sweetner of warrants being attached. Especially given RMM aren't in a position of strength.
Convertible debt to equity is possible and that would be dreadful for anyone already invested, or investing today.
In short, assuming RMM navigate the situation the upside is unknown until the equity arrangements are clearer. You simply can determine the possible price per share without knowing the likely shares in issue.
The equity arrangement is likely to reduce the price so waiting would maximise an entry, or at worst could undermine the investment case entirely. Depending on the terms.
By waiting, even if rambler manage this very well and waiting means you buy slightly higher, the information will enable a substantially better ability to determine the potential return on any investment and be lower risk of losing all the capital.
Atb
Correction: You simply can *not* determine the possible price per share without knowing the likely shares in issue