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Bankruptcy normally happens when net assists negative (liability is greater than total assets).

SM has Net Assets £574.60m at the end 2018, and more now after the raising of $425m in 2019.
How can such a company with positive net assets bankrupt?

Why is SM in such a hurry to commit to one deal and not to allow other alternatives to be brought forward and considered/voted by the shareholders (together with the AAL offer)?

If the poly4 market and the cashflow potential were as good as suggested, $600m should be collectable, especially from a group of the IIs that may also have a big loss with the 5.5p per share offer.

SM may consider AAL is a better choice to build the mine with the needed funding for both the Initial scope and the deferred scope, this is true. However, their plan out of the strategy review has been to raise the $600m first in either one of the two processes or a combination of them. The $680M proposal seems to meet what they said in the plan. Why blocking it to be revealed for shareholders to consider (whether it is better or worse than the AAL one)?

illbetabuck: ", it could be considered a 'zero' risk one way bet."

zero in ""?
Does Polygon have a way to make this bet zero risk (in case of No vote to the AAL offer)?
Does it involved in the alternative $680m proposal? Is this proposal also a 100% (that is worse than the AAL one)? If not (i.e., if it is a partial bid sharing the mine with existing shareholders and enough to cover the Initial Scope), why not to give shareholders another option to vote together with the AAL offer?

541,580,000, 7.715%
Why?

Longtermview24, SM does not have 1000 employees; most of the workers come from the constructors who will not receive the money. Only SM's staff, a couple of hundred are to share the £19 m.

They have themselves compensated at the expense of all other shareholders!!!
That is why the alternative proposal was left aside; or push off with a little time to revise and consider (as they have committed to support the AAL deal in writing.)

"Instead, it is asking shareholders to back a deal which values current shares at £386m plus stock worth £19m which will be issued as part of employee share plans."

£19m to compensate the SM (less than 300) employees in addition to the 5.5p per share (plus jobs); however, majority of PIs and IIs have nothing more than the 5.5p!!!

https://news.sky.com/story/mine-project-investors-urged-to-accept-shock-cut-price-deal-11913284

AAL's firm offer is now an Acquisition, but they could choose to do the Acquisition by way of a Takeover Offer (that might be even more tough). These irrevocable undertakings (by the SM directors) remain binding in the event of a competing offer, which seems to be allowed and could happen in theory (with next 28 days).

SM board directors' commitment on their yet vote is irrevocably ; although other shareholders may vote differently with or without other bids/proposals?

Sirius Directors who hold Sirius Shares have irrevocably undertaken to do or procure to be done in respect of their own beneficial holdings, amounting, in aggregate, to 172,462,637 Sirius Shares representing, in aggregate, approximately 2.46 per cent. of the issued share capital of Sirius as at 16 January 2020 (being the latest practicable date prior to this announcement).

Net Asset over £700 ---> Net Asset over £700m, of course.

By the end of 2018, SM has £574m net asset (total asset 1,030m - Current Liabilities 242 - Non-Current Liabilities 213).
In 2019, SM raised $425m, the estimated Net Asset should be more than £700m.

Bankruptcy is normally resulted in situations when liabilities are greater than the total asset, i.e., Net Asset negative.
How could a company (SM) with £700m positive net asset be bankrupted?
I has made great progress on construction and marketing. With positive Net Asset of £700m, they can freeze the project for years, if they want, to sort out the funding needed to proceed!!

So far, we have not seen big sales of shares by the big IIs (as these have become open in last few weeks in RNS).
How can AAL sort out the big IIs for a 75% votes, by promising them or offering them some additional compensation (that PIs cannot get)?

Do not believe the $600m is so difficult to get, unless SM wants more assurance and very picky on investors and partners (i.e., have to be a halo partner). Actually, if they can get $600m plus a good enough but not as big partner as AAL, the chance for them to get the follow-up funds would be quite high (even with the gov support once the project is de-risked).
AAL's interest and the world class asset (tier 1) as they mentioned should enhance other potential investors' confidence to come up with something better (a partner + structured funding as planned in the strategy review).

Myo, thanks. As now it is not simply an offer. It seems to have become an agreement between AAL and SM; can SM still withdraw this offer (if there is any term in the guideline on such situation?).

Myo, thanks. As now it is not simply an offer. It seems to have become an agreement between AAL and SM; can SM still withdraw this offer (if there is any term in the guideline on such situation?).

Myo, 5th Feb seems not to be any significance any more, as that is a date a formal offer has to be made, and now it has been formally made already. When SM said formally after the firm offer that they would recommend it (rather than expected to ... as mentioned before), can any other party still be able to bid or improved the proposal made before (what the takeover guideline says on such situation)?

illbetabuck, when SM said that they would recommend it formally, can other party bid any more from now on?
what would happen if some shareholders still hold after the closing date?

Sorry for the typo: loose a lot money --> lose a lot of money

CF's project attracted not only less sophisticated/experienced PIs, but also a large number of big professional IIs (almost all big U.S. bank involved in different roles). He has also had one of his Australia friend, RS, involved and invested heavily.
Does RS do so without asking financial adviser's advice as most PIs? Possibly, as although RS has been a high-level executive manager for a long time, he is not specialized in financing.

Another CF's Australia, i.e., the former CEO of SM and the former CFO of Fortecue, was as smart as CF on financing.
He was the one who had earn the most from the project, buy selling his over 100 millions of shares early.
CF has not been able to sell due to his role; and to sell the project is one way to sell his shares early; although to see through the project to production -- completing the mine, may also be his ambition when possible. In all his interviews, he had shown his concern and care to his employees, but not PIs (including RS) or IIs that should take their own responsibility on high risks associated with high return opportunities.

Business is business, even if the offer is from an Australia colleague and friend.

The confidence of board chair RS to the company (including its fundraising plan) has been reflected in his purchases of the company shares using his own money (see below from the public sources).

Unlike, CF who got most of his shares for free or at a very low price, and would still have a few million pounds of profit. RS would loose a lot money. When the board has to recommend a takeover offer (not formally yet, but indicated), it would have been in a situation when no better deals available. All hope has not lost yet, although the chance is not high (with at least at some small value remaining with the AAL offer).

RS tradings as available in public domain:
16-Dec-10, 12.5m shares, at 10.4p per share, £1.3m holding 12.5m shares
23-Nov-11, 1m shares, at 23.65p, increase holding to 13.5m shares
25-Jan-12, 18.9m shares, at 18p (placing), increase holding to 32.38m shares
15-Apr-13, 3.26m shares, at 21.49p, increase holding to 35.65m shares
06-Mar-14, 1.67m shares, at 12p, increase holding to 37.32m shares
01-Sep-14, 2.1m share, at 11.75p, increase holding to 39.42m shares
11-Mar-15, 0.714m shares, at 7p (placing), increase holding to 40.1m shares
28-Nov-16, 2.56m shares, at at 20p (placing), increase holding to 42.66m shares
29-Apr-19, ...holding just before stagee placement: 43.5m shares
29-May-19, 2.1m shares, at 15p (placing, 1/22 plus some additional), increase holding to 45.6m shares
01-Nov-19, ... holding as display in SM website 45,645,005 shares

The gov and MPs had mentioned that this is commercial project and if it is variable there should be other companies to be interested and provide the needed fund (what not be said explicitly is no matter in what form).

As the SM plan from the very beginning was a plan based on the gov support (essential in their words), when the hope to get such support vanished , it is driven by the gov to such commercial path.

Big mining companies acquire good junior mining projects at a good value is a normal business to them. It is almost good for every one, except those investors to make the projects a good value. Business is money moving from A to B. One's big value comes from another's big loss. As casa mentioned business is business, there is no sympathy in business.

However, if it is a political decision, some political figures (without personal financial interests but with people's interest in mind) may have a concern on the big loss of a large number of people around the mine, such as the Mayor. Not sure if any of them can help push a win-win deal: with AAL taking a major stake using a small investment ($600m or $300m plus some rights attaching CB/debt investors) as a strategy partner (and largest owner, say 80%) without all the PIs and IIs driven out of the project.

DanTheMan105: "... this is significantly Chris Fraser's project, and his idea ..."

Yes, he quit Citi to explore his own mine project. Up to now, his successful has almost been assured with the project/mine being either acquired by AAL or offered another better deal/funding path. For a person of Citi background, using other's money to create and develop a project from an idea to a junior mining project that can attract big IIs to invest and then a big mining company to buy it is a big success in design. Managing operation and production is not the interest, strength, or purpose of people in his background.