I listened to parts of the conference call again. Let me premise everything I've wrote with regards to this latest financing deal by saying that my thoughts are based strictly on the info that is available publicly to us investors. What is not clear is what the debt covenants will look like. I've assumed that the Asian debt deal fell through because the debt covenants / terms were too unfavourable and left Century investors at risk of instantly losing everything.
I don't know what the debt covenants will look like for this new deal. If it is unreasonable and too risky for shareholders also then Peggy needs to take a serious look at the possible merger deal that was identified in the conference call (while it's still on the table). (the other option) the major that is interested in a J/V (majority controlling interest) in Lamaque doesn't look too appealing as a first option, as we become submissive, plus we get no cash flow unless the majority owner decides to declare dividends.
The caller on the conference call may have stepped over the line at times, but I think he was just an extremely concerned shareholder. A lot of investors have lost a lot of money on this investment. We are at a major crossroad right now. The next move is absolutely critical.
Peggy needs to swallow her pride and do what is best for Century shareholders. What is best also means balancing the risks to ensure we survive in good shape. Peggy and the BOD needs to continue negotiations with the merger partner to see if the deal can be bettered, as a backup plan. In a nutshell, I think this is the point the caller was really trying to make. I agree. I don't get the impression that Century is working that angle, which concerns me. I want to see a backup plan that is being actively worked on, even if we are committed to closing the bank/equity deal.
I am not interested in an all or nothing situation. If the debt covenants are unreasonable and put us at risk of instantly losing everything then we should try to negotiate better debt covenant terms with the bank, otherwise we should more actively explore the merger option. A merger deal might be safer, if the other company comes with good advanced staged properties. It reduces the risk substantially in case the Lamaque ramp up gets delayed. You know, the company can still continue onwards in decent shape due to the other good properties.
Right now, the number 1 priority should be establishing stability and reducing the risks.
3 comments:
they have to make the deal quik cuz some ecologique peoples wanna to break the lamaque project they try now to mobilized peoples who are not in favor of that project and do the same thing whit the open pit in malartic
you guys always talk about the financial project but you never talk about wen century mining going to pay us back
Here is a better idea...Do a preemptive strike and pick a suitor who has the best track record. I like Agnico-Eagle Mines Ltd. NYSE: AEM
Here is why:
• Making money from doing real underground gold mining in Canada.
• Listed on NYSE where extensive capitalization is possible.
• Could easily take on another project.
Does anyone else want to play matchmaker and suggestion an even better candidate?
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