RE: 5 billions share at 0.10?
I would imagine the vote will be carried without to much of a problem. Don't get confused though with issued and authorised share capital.
This breakdown by RBC on mineweb provides the basics of the deal
https://www.mineweb.com/mineweb/view/mineweb/en/page674?oid=76430&sn=Detail
• RBC Capital Markets recommends shareholders vote in favour, as RBC Capital Markets believes Katanga is at risk of administration in the absence of other funding.
• More financing needed. Katanga requires an additional $250min debt/equity during H1 2009. In RBC Capital Markets' model, RBCCapital Markets has assumed this will be raised 50/50 in debt/equity inQ2, at C$0.28/sh.
• Production plan revised down. The plan envisages lowerproduction, maintaining capacity of 70 ktpa until 2010 and 150 ktpa by2012. Thereafter, the original plan to ramp-up to 300 ktpa with the newSX/EW facility will continue. Katanga expects a revised developmentplan will be released later in Q1. In the meantime, it has been unableto provide any guidance on opex or capex. Thus, RBC Capital Markets hasmade gross assumptions in its model.
Valuation
RBC Capital Markets is downgrading its recommendation to Underperform toreflect the near-term financing risk, expected dilution, uncertaintyover the development plan and negative near-term copper and cobaltoutlook. Over the longer term, the stock still has potential forpositive returns, reflected in RBC Capital Markets' revised targetprice.
RBC Capital Markets is reducing its 12 month price target to C$0.50/sh (post financing basis), from C$1.50/sh, due to revisions to its model. This suggests a return of 14% above the current share price. Priced as of prior trading day's market close, EST (unless otherwise noted).