Its pretty simple, there is no money left that's why its in receivership!
The sale process is incredibly complex;
1. There could be more than one party ie AEJ and possibly other parties
2. The lender, Employee representatives, Government both state and local, suppliers have too all be on the same page
3. The proposal from AEJ would have been quite complex and I assume that the lenders have asked the receivers to do some senarios and as a result the model/proposal changes and is reworked
At the end of the day its up to the lenders to feel they have extracted as much value from the proposal as possible to minimise the writeoff.
I suggest that the potential proposal is a debt for equity swap that provides the lenders with equity and control, it dilutes the existing shareholders massively but still provides them with value. The overall debt would be restructured and significantly reduced as the lenders take on equity rather than debt.
If all parties become comfortable I can see a great outcome for all!
Its just a slow process.
AEJ Price at posting:
$8.00 Sentiment: Hold Disclosure: Held
