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Molycorp (MCP) -9.6% premarket after announcing proposed offerings of $300M aggregate principal...

Molycorp (MCP) -9.6% premarket after announcing proposed offerings of $300M aggregate principal amount of its convertible senior notes due 2017 and $150M of its common stock, three days after S&P's downgrade. MCP says proceeds will be used to fund expenses for the remainder of 2012 and H1 2013.
Comments (5)
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    See http://bloom.bg/Rldp40 and the comment(s) at the bottom. The share lending deal with MS is of material importance.

     

    Not clear where MCP bottoms. Will they make it through this infusion of operating expense, working capital and capex to a sustainable cash from operations, or will they require even further infusions and dilutions? Regulatory uncertainty from California also remains a headwind. (I'd like to see the company survive and thrive, but where's the bottom and some predictability?)
    16 Aug 2012, 06:41 PM Reply Like
  • jackmayes
    , contributor
    Comments (15) | Send Message
     
    I sold out at $20.50 when I came to grips with the 10% $650 million they were borrowing to fund the Neo purchase. Every once in a while I'm lucky instead of good. I'll take it.

     

    MCP is a falling knife. It bottoms when it bottoms. Wish I knew. I like the story but I've been wrong too much this year on materials.
    16 Aug 2012, 07:34 PM Reply Like
  • Ted Bear
    , contributor
    Comments (597) | Send Message
     
    Please provide a link to the share lending dealing with MS...i am too lazy to dig through all of the filings. It is probably "structural" in some way, but until i see it i can't explain it for you.

     

    I do own a small position in the shares down here.....if only to see what happens when the wind blows over and the shorts are left to ponder , what next?

     

    It is never good when money is raised in the equity 'capital' markets to fund 'operating' expenses....but it is hard to tell what is operating and what is capital expenditures related to the mines they are developing.
    16 Aug 2012, 07:42 PM Reply Like
  • Whitehawk
    , contributor
    Comments (3129) | Send Message
     
    "It is never good when money is raised in the equity 'capital' markets to fund 'operating' expenses"

     

    Then why do you own shares -down here- ? More downside this morning in the shares, under $10.

     

    I don't and wouldn't. I don't need an explanation of any of their deals, they are dilutive and worrisome. I am only asking if this company will remain a going concern (I'd like to see it survive). Without a catalyst, I don't see buyers or a short squeeze.
    17 Aug 2012, 11:31 AM Reply Like
  • dsdavies
    , contributor
    Comments (7) | Send Message
     
    Either way this unfolds, I feel comfortable going out a couple of months and buy both the 10 calls and puts. The risk of it stagnating here is minimal IMHO.
    16 Aug 2012, 08:56 PM Reply Like
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