Yes, baron.
IFN is at an interesting juncture - the uncertainty reflected in the share price.
On-shore wind is the cheapest electricity generator around. Add a battery to improve consistency and reliability and the business case is compelling.
See:
http://www.watoday.com.au/business/...hilling-for-fossil-fuels-20180329-p4z6vb.html
Yet IFN is paralyzed by high interest debt and restrictive loan covenants that sweep the majority of cash to principal repayments. It's solid revenues build the balance sheet but are not available for investment.
It has a refinance offer from Goldman Sachs that removes the covenants while still at relatively high interest rates. Of course the BoD would have trawled through the array of finance options. This seems to be the best offer on its existing kit.
Meanwhile, low interest rate entities like the Clean Energy Finance Corp and the Northern Australia fund will only finance investment in new projects.
I think IFN's best call is to free itself of the covenants, continue paying relatively high i rates on existing kit debt of $525m, grab the cheap finance for new projects, minimise the expensive debt, and re-profile its debt over time as opportunity presents.
On 19 Feb, IFN indicated it expected to re-fi by 31 March, so an announcement is imminent.
The BoD has been silent and seemingly inactive. This of course is not true, it is just bloody hard! I expect the announcement to include significant investment initiatives in new windfarms and at least one (scaleable) battery, probably on Bodangora,
Now that would reignite the share price!
Ash
