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Was the loan from Citic funded? You bet!

|Includes:Puda Coal, Inc. (PUDA)

According to the most recent 8k, Mr. Ming Zhao denied that the loan from CITIC amounting to 3.5 billion RMB had been funded and hence the 49% transfer and 51% pledge would be ineffective. Link HERE
However, according to 《财经国家周刊》Economy & Nation weekly (a subsidiary of the states media Xinhua agency), dated 3rd May 2011, by the end of Jan, 2011, 3 billion of the loan had been used to buy several mines and to upgrade the machineries. This contradicts Mr. Zhao's words, but I know which side I would choose, if the loan hadn't been funded, there wouldn't be a need to increase it from 2.5 billion to 3.5 billion in Nov. 2010. The weekly also listed the specific mines that were bought using Citic's loans, so looks like it's not a baseless fabrication. What's also interesting is that the weekly also pointed out that Puda's core assets had been pledged to Mingshen banks etc to the tune of several billions RMB long before it was pledged to Citic, so we may have a seniority issue here.
Nobody knows what's gonna happen next, but if Mr. Zhao is lying to the audit committee even now, how much can we expect from the 12 dollar offer? Maybe I am the only fool still thinking about that offer, given the stock is trading at sub 2.
Disclosure: None

Stocks: PUDA