FDL flinders diamonds limited

placement

  1. MM8
    7 Posts.
    Hi all,
    I don't usually post on HC - usually on a different paid forum site but I do read HC from time to time. Anyway saw a # of posts about the placement and thought I might share the following with you as some of you seem rather misinformed. Always best to check the facts before making your decisions.

    Take what you want from it - I hold both heads and options from the very early spike and am still bullish.

    Phoned up FDL this morning and spoke to Richard Willson - Company Secretary. He was very positive as can be expected from a company line on the ann:

    I confirmed the following points:
    1) Current option holders will not be eligible for the 3.6m placement
    2) Only those who are on the register TODAY are eligible - so if you converted your options today or if you're bought any heads today thinking you can get into the SPP, you're wasting your time as it won't be settled in time with T+3 settlement
    3) Richard confirmed that they did have money in the bank to get drilling started but not enough to go and do a proper job and see it through. This placement will allow them to go in and do an extensive drill project to get the job done with the belief that the initial estimate is conservative.
    4) Drilling is still slated for late Q2/early Q3 - placement doesn't speed up process but will deliver a better quality output of results
    5) Placement done tactically at 10c to enable a floor and leave option holders in the money
    6) Interest was huge for placement from his perspective

    My view is that the placement is very positive as it allows them to really do a good job for the drilling process and prove the JORC, which off the record sounds like the current estimate may be conservative.

    I'm pleased that the placement was well thought out with FDL using Bell Potter and not Pattersons which Big Kev has used before for MXR or else we could have had another disasterous share placement to the SP.

    The placement is aimed at bigger investors and the SPP is really a token gesture to existing shareholders given that you can only buy a maximum of $2k's worth - I mean I would lose that with just 0.05c drop in my options holdings, let along my heads count. Would I really go all out and buy a heap to get $2k? Doesn't sound like a good move to me.

    The current 12c is a good result and the key will be how it holds up for the next few weeks but I think as 10c has been set as a floor, this should travel nicely heading into the future. Small short term pain for huge long term gain.

    I'd maintain that this is a time to buy and options look extremely cheap with a 7.1c differential to heads - compared to their usual 5.5c difference.

    Good luck to all holders and any new buyers - and I pity those shakey monkeys who have fallen by the wayside and don't buy back in when the JORC is proven.

    Like I said before, I don't usually post on HC so if you don't find the above credible, that's your call. Make your own decisions and if in doubt, call them up and check it out yourself.
 
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