RE:RE:RE:RE:RE:RE:RE:RE:RE:D-day is Nov 26, why it is collapsing now?biggerr wrote: so you're saying McKenzie is making money? Maybe they'll get a good price for it
Well it depends in short. The mill itself would start to be profitable at maybe US $400/MFBM, which is back at where we are roughly. The mill will probably have a long run margin of +$50/MFBM, punctuated by better upside and worse downside. So I'd expect the long-term prospects to be +$12M per year. The asset value there might be 6x that EBITDA level, so maybe $72M as a sale. The timber tenue is worth $85/M3, and they have (I won't check, but from memeory) something like 600,000 M3 per year in cut there. So that's maybe worth $51m or so.
Q3 is gonna suck.
The power plant is worth money rain or shine. BC Hydro gave them a good deal on power. It earns consistently $12 to $14 million. These assets have better valuation multiples, more like 10x. So theoretically someone would pay ~$120M for that power plant.
Add it all up you maybe could scratch $200M for Mck operations. Likely a f**k you discount, moderated by Sheilds making deals and doing old boys club stuff, but call it $160M CAD. That solves the debt problem.