The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
I hope you're right re dillution. Not sure whether you look at charts much but if you view galaxy and creat on the same chart you'll see that they have correlated very strongly for some time. At the present time the creat sp is the galaxy sp. There's nothing in it to account for any potential resources. So until we get news on tl i believe we will be at the mercy of galaxy. I continue to hold and have faith although it's getting painful and is a mystery as to why, given the potential, that there seems to be so little interest in this.
Lets hope we find support at these levels. Can't see any readon why we won't fall further though with galaxy on the slide and dillution to come. Shame creat weren't able to give us and indication on when we'll get news. 100m left to drill and additional work mapped out suely they could have set expectation ?
Our share of gxy will be worth 10m less at todays price. With our current market cap at 36m I for one am expecting a big drop. Hope I'm wrong but I fear the TL pseudo update will not be enough to prevent a drop. Long term I agree it's good news but how many Pi's are happy to sit and watch their funds reduce here when they could be put to good use elsewhere and then used to buy back in here at a lower price ?
General consensus on hotcopper forum is that this relates to a forthcoming share issue. Money to be used for aquisitions, loan repayment and construction of battery plant. Short term dullution, medium to long term added value ?
"If we weren't thing about listing in HK we would have been doing stuff every step of the way." "But because of the Hong Kong process we decided to hold back on some of those." Galaxy's Australian-listed shares crashed 15.5c, or 13.2 per cent, to $1.08 on the first full day of trading after the Japanese earthquake. However, they have pared back those losses, closing yesterday up 3c at $1.33.
Interesting article in AFR journal courtesy of advisor71 on hotcopper. While we are on the great investment thread, below is from the AFR on Page 25, story by Dan Hall Hong Kong: Galax's focus returns to M & A hunt. Lithium producer Galaxy Resources is assessing merger and acquisition opportunities after ditching plans for a dual listig on the Hong Kong Stock Exchange in choppy market conditions. Little more than a week since it pulled plans to list in Honk Kong at the last minute, Galaxy executive directors say the compan is free to pursue aggressive expansion. "Now we've got this window we are going to do a lot of things that we'd put on hold", Hong Kong based Galaxy executive director Charles WHitefield said. Perth-based Galaxy had proposed a dual listing in Hong Kong, the No.1-ranked IPO market, to align itself better with China. But a soft week in the Australian market, unrest in North Africa and the Middle East and Japan's earthquake, tsunamin and nuclear crisis force ti to abandon months of planning and walk away from the much-anticipated listing. "At the end of that week we all felt very strongly it just didn't make sense for any of the parties involved," Mr Whitfield said. "It was a disapointment considering the amount of work we had done." The company had planned to raise $US260 million through the IPO to give it added capacity to make acquisitions, fund construction of a lithium battery plant in China and pay off a $US105 million loan facility. The listing process requires extensive funds to build commercial relationships with major banks, which must be engaged before listing under the Hong Kong Stock Exchange rules. Major banks Morgan Stanley and BNP Paribas were joint lead advisers on the IPO. "You are basically introduced ot HKSE by a sponsoring bank so you've got to find somebody who will back you," Mr Whitfield said. "Your're not just asking somebody to place shares for you. Your're effectively asking somebody to underwrite your reputation.""Honk Kong list is important, but the strategic imperatives of the company are equall important, if not more so." Mr Whitfield said the company might list in about four months. Galaxy has about $120million in cash and expects to complete it $55million lithium carbonate processing facility in Jiangsu province in the June quarter. There is also no pressing need to repay the $US105 million project loan from Austrian bank RZB and the China Development Bank. Stage repayments are scheduled to begin in June 2012. But the Hong Kong executives, who are employed locally by Galaxy under the HKSE's strict listing rules, will waste no time trying to make up for lost time doing deals. Hong Kong-based executive director Anthony Tse said: "The team has alluded in the past that we have been looking at some strategic business developments vis-a-vis potential partnerships and/or acquisitions." "If we