Post by
geordieboy on Dec 03, 2010 3:37am
Equity is the way to go
Any loan to a gold company, especially pre-production, will require gold hedging in one form or another . In a gold bull market this is a no no. Debt is bad idea for a small miner anyway. By raising more funds than required for the capex BZA wil have extra cash to start the drilling needed to prove extra reserves and extend mine life. In terms of moving the share price to another level this would be a big kicker. Also - assuming the PP is filled of course - they will not now need to sell the Balmoral holding which many on this site believe has big upside too. The PP will hold the share price down for a short while, thus irritating those shareholders with the attention span of a gnat, but next year should be a corker.
Comment by
agmetalhead on Dec 03, 2010 7:01am
I couldn't agree with you more equitiy is the way to go. However I could argue that management didn't do enough to get the stock price higher before financing-.50 would have been better. However we only gave up half a warrant with each share at a higher price in 18 months so we're fairly protected.
Comment by
waru on Dec 03, 2010 5:57pm
30% dilution with an additional 15% possible, future EPS will be negatively effected.The insiders have always been very generous in the granting of options to themselves.The "bloom is off the rose" and the best before date is approaching rapidly, as a long timeinvestor (ITS) I hope to find an exit strategy with the next positive NR. I'm thinking cobalt.