RE: ARS1 Feb 2021 11:37
Sorry Maqsood but this stock is going to slowly drop until Tony gets a capital raise away. It always happens and will most certainly happen here, especially after recent happenings.
Tony must know by now that his cash pile and burn rate are critical to being able to secure the best possible deal. If you're about to do a deal with someone and you know they really need cash (and quickly), then you'll always have the upper hand. Think of it when buying a house, no different here. So until he gets away a raise the SP will drop. The raise will strengthen the balance sheet and his hand in any negotiations, and it will also put a floor under the sp. They should keep AE and anyone like them away from this raise and focus on getting as much PI support as possible.
As for getting a better deal. The reason why I sold in the first place is the deal was 'too good to be true'. A cursory glance at the partner, and how the deal was structured made me dump my shares quite quickly. Turns out the deal was too good to be true.
Tony should have known all of this. He was desperate for the cash and has simply dug a deeper hole. He needs to build a bigger cash position. I'm thinking a raise at 1.6p, for circa £2.5m and 10% dilution. They could thrown in some warrants as well worth a further 2.5-5% dilution but at a strike price of say 3p. Tony then needs to focus on getting the final permit for KSK plus whatever permits / permission necessary to re-start drilling on Beutong. These things will allow him to do a deal on a much better footing. The SP will be over 3p on the final KSK permit news alone - It makes the project 'shovel ready'. He could then do another small raise for a couple of million but say 5% dilution and start some drilling on Beutong, all while negotiating with a potential KSK partner. A couple of drill results form Beutong and the sp could easily double. It would be prudent to raise again from these levels, and continue drilling Beutong. Also you'll have partners willing to stump up more cash for the real prize Beutong, whilst having exposure to a fast build mini-cash cow in KSK. Tony has made some foolish decisions over the past few years but all is not lost here. He just needs to get his priorities and focus right. As much as people slate Nick Mather over at Solg, at least he did things the smart way. Beutong is supposed to be a similar resource to Alpala, which gave them a £400m Mcap. Tony could learn a lot from Nick.
I'll see you again as an investor after the next raise. But for now, I wouldn't put a penny in here until cash pile is topped up and forward guidance with priorities in the right order have been given. AIMHO ATB
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