GREY:FNKLF - Post Discussion
Post by
mcugly on Mar 19, 2013 11:15am
Consolidation
Currently I don't see the need for consolidation but that doesn't mean it won't happen. In Sept 2011 they closed out their hedge positions and generated approx $35 million in cash. As a result they cancelled their $30 million loan with SocGen and the Commonwealth Bank of Australia. Now that they are in need of further financing, I don't understand why they can't renew that agreement to carry them through this period of low nickel prices. Once they achieve full production, which is supposed to happen by the end of this quarter, they should be generating enough cash flow to weather the storm. Consolidation generally is beneficial to management and not the shareholders. I wonder what the 2 largest shareholders, Resource Capital and West Face Capital, would have to say about any consolidation. They continue to approve loans and acquire shares in lieu of interest so I submit that anything management does to negatively affect s/p, i.e. consolidation would not meet with the approval of these shareholders. But I could be wrong. JMHO
McUgly
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