Post by
tylerreddick on Dec 18, 2024 10:35am
The big unknown
The big unknown is just how much cash will Newco get?
The presentation uses $20 million, reflecting total transaction costs and debt repayment at $10 million.
But is that realistic, considering GXE had $15 million in debt alone last quarter?
What if Newco only gets $10 million, or less? That would change the equation drastically.
Until GXE puts out the full information circular on the transaction, anyone buying today is doing so with only partial and questionable information.
I had actually considered buying some today, but then gave my head a shake. Why would I buy without knowing exactly what I was getting, and why would I buy knowing I will be forced to take shares in a company run by the same folks who destroyed GXE's share price.
Comment by
Roscoe747 on Dec 18, 2024 10:51am
IMO, with a 35 mil credit line and negligible cash, Newco is just one bad well away from a 2 cent stock with an unsupportable debt load. Newco will open at $2, drop to a buck and wither away on missed guidance and unexpected exploration costs coupled with high corporate costs.
Comment by
tylerreddick on Dec 18, 2024 12:48pm
Roscoe, there is a ZERO chance that Newco opens anywhere near $2. Bagholders will be lucky if it opens much higher than one dollar. And what happens when even more people sell into a lack of interest?
Comment by
Roscoe747 on Dec 19, 2024 11:53am
Yeah, thats what I meant. Poor choice of words. The SP of Newco. Will drop like a stone on opening. The only redeeming feature of Gear is its long life heavy assets. Mediocre assets. I think Gilmore quit because he has too much integrity to front this stinker.