Being induced by management to subscribe to a capital raise at a highly inflated price is not a good thing.
1. It means management mean shareholders are foolish enough to buy their rubbish.
2. It means they can afford to pay themselves their inflated salaries when they've achieved absolutely nothing.
It's for these reasons that ASIC require product disclosure statements to prevent foolish investors throwing their money at a capital raising that they do not understand.
Does anyone on here actually know answers to the following (not guesses but answers).
1. What breakdown of the CR will be used to simply fund management versus how much will be used for the Project
2. How much upfront capital is ultimately required to get the Project operational?
(This should include capex plus working capital as well as whether this is planned to be funded by debt or equity).
3. Provide a 10-year cash flow projection (updated to reflect the higher price of manganese, but also updated to reflect the higher cost of inputs for production, and impact of change to exchange rate).
Also provide sensitivity of the above variables to the NPV.
4. What is the appropriate discount rate for a project of this nature (it's not the 8% at which they've previously conducted the NPV).
5. How much maintenance capex is going to be required on the second hand smelters they intend on purchasing. What is the remaining life on these smelters
6. What approvals are required to get the Project operational. What are the status of any that have been submitted for approval?
7. What is the tax rate applicable to this project?
8. How does GMC intend on meeting that requirement that an Indonesian must start gradually acquiring the project?
9. Provide an update on legal advice in relation to matter against the Toad.
10. Anticipated project timetable.
11. Current contracted FTE - to establish the current recurrent obligation to GMC following the recent appointments.
What other key personnel are required and when?
12. Material risks to Project success that investors should be aware of.
My guess is that none of the above has even been considered yet. Maybe GMC need assistance in running a due diligence proces, albeit an internal one and require a checklist so we don't have to go through the Toad saga again (following which I've lost confidence in management and believe it's time for a new team).
Without this information it is ludicrous to postulate that this capital raising is going to solve anything / is beneficial.
I'm seriously concerned for some investors on here who are now acting emotionally and irrationally.
I will write to ASX/ASIC (by Wednesday, I'm too jet-lagged still) and request a Prospectus styled PDS after this debacle.
Without it they aren't getting a cent from me, and neither should they from you.
The biggest warming sign is of that last $1.5M raising what have they achieved?
I'd like actually see how they spent it all.
GMC Price at posting:
4.2¢ Sentiment: Hold Disclosure: Held
