RE:RE:My personal thesis ... Thanks @Talchior; I see your approach. As of Jan 2, 2021, the total debt is $91.6m. This also increases the annual interest by $535k. They already corrected that in a subsequent post.
Of course, the condition is that as you write, the entire FCF is used to repay the Debt. Nickel 28 would have no FCF for the Company for another 2.5 years, for example for dividends.
The crucial point would of course be, at what share price would Pala Investment buy into Nickel 28. I would also assume a premium. The fair value of Nickel 28 is 3.04 CAD/share (Arlington Note). So let's say Pala Investment would buy in at 50% of the fair value, 1.50 CAD respectively 1.25 USD. This would mean about 48m shares for 60m USD. A dilution at FD 90m shares of 53% - after we have FD 138m shares.
Your 30mUSD (you have rounded up generously) would be at a share of 11.3% of FCF 39.6m USD, respectively 0.29 CAD per share. With an investment of 1.50 CAD this means an annual return of almost 20%. I judge this to be a good deal. At a current share price of 0.80 CAD even much better - everyone can calculate for himself.
urai58
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