RE: favorable financing? I wish the financing PE was as high as 3. It is less than 1 when adjusting for existing cash. That is why it was stupid. Cash was 32 cents per share at year end and EPS run rate of 25 to 30 cents. Year end 2012 cash level was projected to be 65 cents per share inclusive of the existing warrants. If an MBA student proposed selling stock at under one times earnings he would flunk a finance class. MMY proposes it and shareholders vote in favor. Beyond belief to me.
The stock has struggled because the proposed giving away a significant portion of a sure earnings stream (Selinsing and surrounding properties) and using grossly undervalued stock to buy an unsure project. Today the overhang of the financing is killingthe stock.
Management's job is to create value on a per share basis. The private placement destroys value. In addition it shows management is either clueless about the financial side or doesn't care. Paying a dividend would get the stock priced appropriately and thus allow for equity financed acquisitions such as Mengapur. MMY could still do everything they wanted and more importantly do it in a way that would make shareholders money.