They had options with the 10mill owed to Dinghy. Dinghy still hold some stock when they acquires some more ( refer to one of the last subst notices... they acquired on market ) - but ELM chose to pay Dinghy off- I think thats the right move. If there were any huge material stress they would not have... As already mentioned, yes, 1 quarter is not a long time but it is long enough for ELM- again, the Drill program...
At these low prices and low stock vol situations, it's very hard for a large holder to get stock. ELM reduces Dinghys potential stake on more stock by paying them back instead. If there is future interest, it is more difficult for Dinghy to be a blocking holder... and depending on how smart ELM do their next CR, and there is very likely to be a SP rally in the leadup to the drill results and the "sweetening" of the SP for a CR. Yes, there is all the dilutions etc, cannot really avoid that, ELM is into Potash and it costs Billions not millions to finance such..... it wouldn't hurt to have the assurance of institutional investors on board rather than the stale boat that is dinghy anyway. This low SP... 25c last raise, and 23.5c... if ELM do it right and the SP moves to say 30-35c+ in the ST.... a CR to institutions could occur at MUCH higher than todays price of 23.5c.... One annoucement is all it takes to take this cash worry away....
They will be enough cash onboard when the time comes, whats hurting the SP in the ST is more the lack of activity, resulting in some larger holders able to manipulate and accumulate stock. Once the "action" is ready to occur, it will be fast, it will have to be, cos raising funds will depend on it and they will move this SP. It goes without saying it is those stakeholders will move SPs not small holders like us... and the signs are all there.... 3 months (1 quarter ), kind of a GOOD thing if you look at it this way as you know in the short term, the waiting is limited.
Just had to mention this STB debacle again... massive rises over last few days, all due to some HK based co investing a "strategic" 1.8 mill @ 18c .... and today appointment of a drill contractor... stinks of a hanlong type debacle of times past with SDL... (apologies, just a loose comparo, but point is the ability to move the SP with simple cooperate moves and CRs ) just compare the "value" of our company to STB...
ELM could do this same move and more... and all well within the next quarter.... why, because it has to, because of news, because of need for investor- I have confidence at this low SP that brokers can bring in the interest- easily. So the Q is- is it better to BUY now at 23.5c or when it is 60-80% higher sometime in next quarter?
K2P Price at posting:
23.5¢ Sentiment: Buy Disclosure: Held
