RE: RE: RE: RE: RE: RE: MJS-V Looks good todayHi Elmo,
You make some good points about being over-leveraged and the ability to service the new debt.
Regarding the 50/50 equity/debt structure, my thoughts were this:
-As we've seen from the PEA, Year 2 and 3 will have the highest production due to the expected grades - which on a 1.4 Year pay back, is certainly a positive.
-the current construction is being funded by the partners themselves (the ones that bought out the former partner and then exchanged their interest for Majestic shares), so with that, much of the capital would go to them. I would assume (perhaps niavely) that there would be flexibility with them.
That said, your points are very reasonable.
In addition to the two types of financing we discussed, I would also not mind debt financing in two or three tranches. There is indicated that some of the Capex will not be needed until years 4 or or 6 (or later) for expansion of the tailings facilities. So, perhaps a few tranches would be the smartest.
All said, I guess we could talk about scenarios until we are blue in the face. Bottom line for all holders is that this property is very viable, and shareholders that have positions now are in for a stellar return over the next 1 - 2 years.
My hope, as always, is that Majestic gets taken out late 2001 or early 2012.
Tough day in the market. If MJS trades in this area for a couple weeks, I'll be happy - but investors should be expecting YE financials Friday or Monday... and hopefully we see some forward looking plans/statements in the MD&A.
Cheers!
B