Post by
bond46 on Apr 20, 2013 1:59pm
Did weak market kill the deal?
Still it remains a mystery why Portpool backed out of the deal after going through all the trouble of dd and hassle. And one of the questions management will have to answer if ever is going to be an AGM is why Portpool backed out. Given the market conditions and the low price of met coal, the Portpool Investments could not secure a sale contract from their Indian coal end users, as perhaps they had thought at the start of submitting the letter of intent, and they did not want to get stuck in a situation of having the mine in a care and maintenance for very long for they would lose their investment. So they probably waited till the last minute hoping for a sale contract and when it did not come through, they had to back out. The other possibility is that they did not feel confortable with the current board and management and the risk of having to replace the entire crew to run the mine. Their link, Haywood, was probably too weak to rely on hence they jumped the boat. But if the market turns around in a year or so, we may find them in front of us again.