life after bmg.

With Hawsons being our flagship project, it is indeed the Company maker for CAP and our management team have been extremely dilligent in focusing on adding value to the project whilst our J/V was held up in the courts.

Now with BMG dead and orders in place for BMG to be liquidated, how will this end up?

Some background:

* ASI purchased 25% of BMG for $16.5 million.
* BMG invested $13 million in Hawsons for 40% of Hawsons
* A Further $25 million must be paid to CAP by 15th May to move BMG's interest to 51%
* If the $25 million is not received by close of business 15th May, CAP can purchase back the project from BMG for $13 million.
* If CAP finds a new J/V partner and they pay a minimum of $13 million to BMG, then BMG must sell their stake to the new J/V partner.
* BMG now in the control of a liquidator.

Scenario's:

* With a liquidator appointed to wind BMG up, I can not see BMG making a payment of $25 million to CAP. BMG has some other assets, but I have no values at hand on these other assets, so will work of a zero value. The way I see it, BMG will get a minimum of $13m from the sale of their J/V holding in Hawsons. As a 25% shareholder in BMG, ASI will receive approx $3.25 million from the $13 million.

IF ASI are serious about Hawsons, then ASI buying BMG's assets from the liquidator makes sense, as for approx $51 million ($16.5m from inital investment in BMG + $9.75 million (net differnce in buying BMG share of Hawsons ($13m - 25%) + $25 million due 15th May for BFS), ASI would own 51% of Hawsons for $51 million!!!!

To quote part of Judge Robertsons comments: "Hawsons Knob project was the main reason why Ms Lau recommended that Ample Source take a 25% equity stake in Bonython Metals".

IF ASI walk away and only get a percentage back from the liquidation sale of BMG assets, their foray with BMG will have cost them around $13 million...... ouch

* CAP could raise the $13 million to buy back 100% of the project. If they stick with the mantra of no debt, unload the GUF shares, we would need to raise around $12 million.

At 30c per share capital raising thats some serious dilution plus no partner to pay for the BFS or to help with CAPEX down the track. CAP would then have find a buyer, which could take time. This is not my prefered option.

* A new J/V partner deals with the liquidator and takes over the J/V. This could be where some known CAP shareholders come into play.

* I have not been able to find anything that states CAP must buyback BMG's interest if BMG do not elect to continue with the J/V. So if no buyer can be found, what happens to BMG's position? I doubt this will occur but an interesting thought.

IMO, ASI taking over directly from BMG would be the best outcome for CAP shareholders, as we know they have access to funds, they don't tolerate fools and that they are extremely interested in Hawsons.

One must remember that through buying into BMG, ASI paid $16.5 million for approx 10% of Hawsons (ASI paid $16.5 million for 25% of BMG and BMG owned 40% of Hawsons).

Sorry for the long posts, keen to hear other peoples thoughts on how this will playout and what is the best scenario for CAP shareholders.