Cut through the B.S. 2 important pieces of info The majority of the report is relatively unimportant, production outlooks were cut in the last financials, I found two things VERY IMPORTANT.
"On the announcement of the Transactions on March 2, 2012, the Company outlined the Pro Forma Use of Proceeds, including an approximate amount expected to be available to shareholders on closing of $36.6 million. The Pro Forma amounts were subject to change due to, among other things, currency fluctuations (conversion rates were based on the Bank of Canada noon rate as of March 1, 2012), results of operations and the repayment at closing of the Transactions of any amount drawn under the Gold One Loan.
So essentially management is saying that the Pro Forma proceeds could actually be any number, 36.6 million is not gauranteed...and then the NR says...
The Company has accessed $5 million of the Gold One Loan and expects that it will have to draw on the remaining $5 million to sustain operations. As the Gold One Loan must be repaid at the closing of the Gold One Transaction, the repayment of the loan will reduce the Pro Forma Proceeds at closing by $10 million. In addition, under the terms of the Transactions, the working capital of the operations acquired must be positive, or at a minimum there must be at least sufficient cash and other current assets to fund current liabilities. If there is a further shortfall in operating performance, that may further reduce the Pro Forma Proceeds and result in material reduction in the cash available for distribution to Shareholders at the closing of the Transactions"
The credit loan has been accessed. The Pro Forma Proceeds have dropped from 36.6 million to 26.6 million, meaning that shareholders would only receive 0.11/share initially, followed by 0.0-0.11 a year or more later, for a possible total offer of 0.11-0.21/share. There you go. 0.11/share. Who the **** is going to vote for that.
The other important piece of information was that FIU expects Ezulwini to be profitable by May 2012. Which of course is close to when the vote is ironically enough.
I am actually very happy that FIU management decided to draw on the credit facility, dropping the Pro Forma proceeds down by 10 million means that no shareholder can vote for this deal. EVERY SHAREHOLDER WILL NOW BE AT A LOSS UNDER THE CURRENT ASSET SALE. I am surprised Gold One, AngloGold or FIU management thought anyone would vote this through actually....