GLOBAL MINERALS LTD NEW GMFLF

Capital raising implications

[nostril]

On 13 January they Global Minerals announced a capital raising of $2m, noting that this could increase by $1m to $3m. On 22 January they announced that due to strong investor demand this has now incresed to $3.5m.

Setting aside the dillution of existing shareholders (of which I am one), I am trying to work out what this means for the stock. Here are my, somewhat uninformed, thoughts:

1. The current market cap of Global is just $5.5m. If Global gets the $100m financing it needs to start production at the mine, I would think that it will trade at multiples of this. To me this means that the shares are being priced assuming a very high probability of failure.

2. Given that the feasibility study has not yet been finalised and published, I don't think anyone can make an assessment as to the viability of the mine. Unless of course, they know something about the feasibility study that is not public knowledge.

3. Regarding the recent financing, I would imagine that the investors who are putting up the $3.5m would have tried to do a lot of due dilligence on their investment, and may have got some hints along the way on the likely outcome of the (already advanced but not finalised) feasibility study. There are plenty of struggling junior miners that are in desperate need of cash, why did the money flow to Global?

All of the above makes me think that the FS news that will follow the capital injection will be positive. If the company can raise $3.5m of equity now, before any feasibility study is released, I would guess that they have a reasonable chance of raising the $100m it takes to build the mine after the feasibility study has come out. If this happens, the probability of failure implied in the current price will likely change significantly and the share price should rise accordingly.

Or to put it more succintly, I think the financing significantly raises the chances of this mine being put into production, but the market has not noticed this.

Anyway, interested in any reactions from the board.

N

Disclaimer: I own Global Minearl shares, DYOR, eveything is IMHO, please don't treat anything I say as advice, blah blah blah, etc.

[truespeculator07]

In my opinion this is still a solid stock. what has changed in this company in the last 2 years. They still have about 28 million ounces of silver (Meas+ind+inf) along with copper and antimony. They have lot of mine infrastructure in place, de-watering complete and being a historic silver producing mine they have veins opening in many directions increasing the possibility of silver find in many