I have to ask why are these guy's continuing to buy?
Obviously they are in the know to want to accumulate so much so quickly. They are the reason why the SP holds up so well.
The board stated that they have an extension until the end of May to negotiate the debt. On top of this they have entered into a dispute process on their contract with the state government.
I suspect they have entered into the dispute resolution process so that they can have clarity prior to the end of May as most dispute resolution processes have a 10 day cycle before they hit the courts.
I suspect that the State Government is trying one on and they will capitulate otherwise they will shut Redbank down and I suspect they dont want to be held accountable for that. It also makes a mockery of the $8m the federal government hands out to Redbank only for the state to shut down the business!
I still see the value in Redbank and go back to the Independant experts report that stated Redbank as a going concern would be valued at around $24m after debt. Since then the debt has dropped and the EBIT has improved.
AEJ Price at posting:
$4.25 Sentiment: Hold Disclosure: Held
