Can you say how you know Korda Mentha have until the end of the month to make a call, and why are other options still there considering how long they have been trying to close this out?
While the power station was generating cash Korda Mentha could pay its fees. The longer they take to resolve the matter the less return there is for the Secured creditors.
I would assume then that Korda has weighed up the possibilities of selling the pieces against the possibility of reinstating the power station (per the directors of AEJ) and I would have no doubt the second option is far better for a return to the secured creditors than selling the pieces.
Selling the pieces would not return 100% to the secured creditors and so they would need to take a hair cut. If however they took the same or eqivalent haircut and reinstated the power station they potential can then sell that debt on and recover the same amount. effectively they get the same end result, the employees get tehir jobs back, the mine continues to supply and the shareholders do not wipe out their complete equity. WIN WIN all round!
I continue to wait in anticipation.
AEJ Price at posting:
$8.00 Sentiment: Hold Disclosure: Held
