12m mc, 3m cash, 400mt jorc!! 2bt target!!, page-74

I believe it is Gizard who has mentioned this idea, and I can't fault his logic.

It goes something along the line of...

The value of this company is clearly around the $30M mark just on the JORC at the first prospect alone, so I figure a broker will give the share price some upwards pressure as we near the acquistion dates in early May for the two prospects. This is when we will pretty much seal the deal on the 75% stake at the first prospect with the $0.5M transaction. Ofcourse we have to spend about $3M over the next two years to fulfill the agreement, but we can pretty much call 75% ours when that date arrives in around a month's time. I have no idea if this in general would be a share price catalyst for a small cap company, but with a bit of broker support, you will probably find the market will wake up a bit more to what Hodges is really on about.

For this reason, I'm backing a capital raising at about 60-70 cents per share in around 6-8 weeks time to raise around $5M. Call me bold. Call me crazy. But with such few shares on issue, it won't be hard for any broker to step up and give this a good old fashioned pump to a reasonable level to raise capital :)

One thing I know for sure, they won't dare dilute the share registry at these prices given they have just bought parcels amongst themselves.

In reality we need about $5M-$8M. At 70cents per share, that would dilute the register by about 14%, while at these prices it could dilute the register by as much as 40%. If we were directors of this company with our own investments in the stock, it's fair to say we would want less dilution rather than more dilution.

If we think logically about this, it makes sense for the above theory to be played out accordingly, but that's just my 2cents worth.

At the end of the day, fair value in the stock right at this very time is up around that 60-70 cent figure in my opinion.