Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
Problem is we are not talking about couple of millions they need they have to find money to pay off lenders and bondholders. But that is not end of it these assets are loss-making so company would need to turn to investors to fund day to day activities. Problem is they have wasted huge amount of money to buy these worthless assets and Arthur knew about it right from the start.
Company would have received RBL by now if there was a slight decent chance of these assets being any good. Oil might be there but cost of extraction is way high for it to be economical and that is where "death spiral financing" came into play. Arthur knew about it but decided to fleece as many mug punters as he can. If bondholders and lenders believed that these assets were really god they would not have pulled the plug.
Some bottomfeeders are trying to here.After what transpired over last couple of days I dont think any sensible trader would touch this with bargepole but again that does not reply to mug punters.It can get suspended at any mintue now.
As there is a pattern , buy a worthless asset at highly inflated price through placing and use some "twitter influencers" to lure in some mug punters, throw loads of sh** at market, set a breakeven production target and get into "death spiral financing" arrangement.Milk it for few years and move on to next big thing.There are quite a few companies like vast,upland resources and many more which will cost mug punters hell a lot of money.
Now we know the reason why Arthur was being secretive about production figures, bondholders were happy as long as they could convert debt into shares to dump them onto mug punters but realized that game was up once JV partner pulled out.