Equity selling off, bonds rallying. Suggests Synlait survives, but existing shareholders are effectively diluted out of existence or otherwise extinguished.
If you take up your entitlement you have the same percentage as prior to the CR, so how do you get diluted out or extinguished? Cheers
How much can they raise via capital raise? Is it up to 10% of the value of the company or more?
I would think a CR of $180m to pay bondholders. The size of CR does not matter very much because both the loan and the majority of CR come from Bright. If A2M does not participate in CR, Bright would get close to 90% shareholding and make a compulsory takeover.
After the game ends, Bright should be able to enhance the performance of its assets or sell Pokeno/Dunsdale at the right time.
based on there ebit forecast of 45 - 60m that would imply they could have only round 300m debt which they could service on those ebit figures
so that implies a cap raise of say 300m and issue of at least 2.5 billion shares at say 12c
probably need to raise more for a buffer if conditions dont improve
I would wonder if Brights plan was receivership then it doesn’t make sense to put up the loan? Simply let SML default on the 130 mil and they get that outcome? No risk that shareholders will vote it in etc?
My thoughts are that A2 do not want to be part of a capital raise which will see them lose their blocking stake as Bright will increase their holding…
It’s such a pity, SML need a major volume customer, A2 need a manufacturer (and it helps that this one is a direct channel to their biggest market) I hope this gets sorted out and they make up and all make money again
because currently they’re on the hook for a 130M underwrite with no security. They need the loan to get it secured against assets. Receivership just means they burn 130M with nothing to show for it, and the bank is happy because they get paid
with 585m debt
less 130 m loan
equals 455m debt still
based on there ebit forecast of 45 - 60m that would imply they could have only round 300m debt which they could service on those ebit figures
so that implies a cap raise of say 150m and issue of at least 1.2 billion shares at say 12c
probably need to raise more for a buffer if conditions dont improve
why are you deducting the 130m loan? its still debt
because currently they’re on the hook for a 130M underwrite with no security. They need the loan to get it secured against assets. Receivership just means they burn 130M with nothing to show for it, and the bank is happy because they get paid
But the 130 mil loan is behind the banks so they would get nothing anyway?
We are talking about a country that can smother the fallout of a 300 billion collapse (Evergrande)
So I personally don’t think 500 odd mil of debt is going to scare them…
Originally Posted by Lego_Man
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at say 12c 
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