14 February 2011 – company update and offer talks discontinued
The company has recently been in discussions with various parties with regards to the short term funding of the business. Delays to the refinancing of non-recourse asset financing facilities have put serious pressure on cash resources. The company is looking at its funding options and there may be an equity fundraising. AssetCo has terminated talks with the potential offeror to concentrate on short term issues. On a more positive note, albeit perhaps less significantly for now, exisiting contracts are performing as expected and there is a high likelihood that new contracts in the Middle East and elsewhere will be announced soon. Clearly this leaves a difficult situation overall but in a nutshell we believe this is a valuable business which should thrive once it is refinanced. Today’s announcement explains recent weakness in the share price and holders should be clear that this is a much riskier proposition than when we originally tipped the shares. However, the shares are a SPECULATIVE BUY for those with patience and good nerves.