Key Dates for Great Southern Limited
Project Investors Meeting December 1st to vote on whether project investors should accept the offer to exchange their project rights for shares.
Extraordinary General Meeting 10.00am (AWDT – Perth) December 4th.
Shareholders vote on proposed issue of shares to project investors. This is likely to be a formality as despite the horrendous dilution shareholders are not being offered any alternative.
Project Investors Offer closing date December 11th.
Older posts on Great Southern Limited
ASX Link for GTP
With TREES2 currently trading at around one third of face value and redeemable in less than one year it is going to be a fascinating and volatile month. There are two major risks:
- GTP goes into receivership, resulting in a forced sale of assets by the banks at depressed market prices which leaves no funds for TREES investors.
- GTP continues to trade
The two main conveants for TREES2 (GTPGA) are liabilities will not exceed 65% of the Group’s assets and net assets will not fall below $280 million. In addition holders can redeem if any distribution coupons are missed. The most recent information provided is net debt is 39% and net assets. In the original offer document the company said $1.984B in assets and $770M in debt for net assets of $1.2B. However, they are “imaginary numbers” with the most recent half year report frm March showing NTA of $600M. In any event both covenants appear unlikley to be triggered. The risk is the assets are being valued at inflated prices, based on historically high land values.
This is a complex and difficult to analyse opportunity, which in part explains the high possible returns on offer.
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