Avenor (avr-tse) - Repap buyout (rpp-tse) Message Board

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Gold/Mining/Energy : Avenor (avr-tse) - Repap buyout (rpp-tse)

AVR 3.800

-5.2%

10:40 AM EST

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To: Phoenix who wrote (29)	1/19/1997 3:09:00 PM
From: Randyfb	of 290

I too have been considering buying Repap shares. The problem I see is that if the takeover fails (as the market seems to be predicting), Repap may be in trouble. Although Repap may be an okay "going concern," I know from the paper that they have debentures coming due in both 1997 and 1998. I don't have their annual report, so they may have other debt maturing soon that I'm not aware of. When these debts come due, Repap will have to find the money to pay them off. This means raising more cash. A share issue is unlikely. Also, I doubt anyone would loan them more money. Too risky. So here is a viable company faced with a cash crisis. If they can't pay their debts as they come due, it may be the beginning of the end for Repap. I owned shares of Trizec Corp a few years ago. Real estate stocks were out of favor (Olympia and York had just gone under) and even though Trizec was a sound "going concern," they were unable to raise cash to cover their maturing debts. My $8000 investment is now a handful of $20 warrants after the reorganization. I have the same concerns about Repap. Any comments?

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