If they announced they were NOT paying the interest any earlier than the last possible moment, then the option of trying to raise capital via the issue of more notes or prefereds would immediately be dead.
Its probably dead anyway but they would be desperately trying every dry creek trying to raise new funds.
Not much of a market out there at the moment for overpriced assets (which their balance sheet is loaded with.
That is - the assets they didn't flog off earlier into the listed trusts when they last needed to raise money.
Key issues here.
1/ Agricultural MIS in all likelihood is dead. The horticultural schemes were killed stone dead by the Howard government and the forestry schemes rely heavily on lending the clients most of the money - funds that TIM doesn't have and which the banks that used to be prepared to finance this sort of deal are no longer prepared to do.
2/ TIM (and GTP) can talk about going into commercial agriculture all they like but the fact is that commercial agriculture cannot support the corporate overheads. Both TIM and GTP were very happy to run olive almond etc schemes when they didn't have to be transparent about the performance and costs but that was only possible in the twilight world of unlisted units in the old MIS schemes.
The market thinks its game over for TIM and GTP. I agree.
Personal opinion only - do your own research if you want to buy or sell.
TIM Price at posting:
9.7¢ Sentiment: LT Sell Disclosure: Not Held
