George Frangeskides, Chairman at ALBA, explains why the Pilbara Lithium option ‘was too good to miss’. Watch the video here.
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Thanks to advfn members for the last 2 links. Apologies if already posted here
They don't seem to be short on news, Just announced a further investment in Meatables the day after placing. Looks like quite a bit more complicated process this placing than most and yet to be voted on. They cant issue an Rns every five minutes , probably cause even more volatility. Its only a couple of weeks till it all goes through. I expected the sp to rise to the weighted average at least. A lot of late reported share trading this evening or just Lse jumbling it all up! There always will be short term volatility in a situation like this . Thats the nature of the beast. They made it a bit more complicate trying to be fair to all investors. Doesn't effect the long term game. Gl
Surely there are planned RNS's between now and the release of the new shares. Without something to hold things up, the sp is surely going to dive.As we know, Agronomics are in the process of bringing out their own brand, so will official news on that be brought out just prior to the release of new shares. Also, what dates do we expect to see the names and holdings of any new major investors in the last fund raise? and will these dates be strategically RNS'd around the release of the new shares also?
Great post RA
Re 4/5, the warrants might have to be held outside SIPP/ISA but will presumably still be available to clients of platforms participating, lucky them. I'm stuck with the slow bureaucratic institutional "no" approach of HL.
Re 8, yes I also think he's effectively snuck the fundraising fee into the performance fee, but I'd emphasise the unique nature of essential and substantial fundraising for the first and one and only trust in a high risk pioneering sector. Who else would have taken the job on and succeeded? It wasn't even deemed possible on public markets as recently as last summer. And what's a reasonable fee, if this isn't? Don't have the answers, but I'm glad the raise has happened and at scale, and the market seems keen. Unlikely to be another raise anytime soon either, and funding discounts (and so fees) might be less severe once this gains more traction.
Thank you for the info RationalAnalysis
Excellent summary from RationalAnalysls - thank you.
1) Most of the money in the fundraise is strategic institutional money. So when the new shares settle in two weeks, they won't be selling then, or in the short term.
2) Many of these institutional buyers owned shares previously, but could not trade during discussions around the fundraise due to having "inside information" about it - hence there were potentially fewer sellers, which could partly explain the price spike in recent weeks.
3) From the time of the announcement, these institutional buyers could sell their existing shares - hence if they wanted to make short term profits (and not be in this for the long term), they could have sold their old positions this week, knowing they're about to get even more shares at 22p (and at 28.5p). It's therefore very reassuring the stock price has done well since Monday, as it implies that these investors aren't selling their original holdings, and hence the "new money" is long term too.
4) Many platforms will prevent buyers who aren't "sophisticated" or "professional" from participating in the broker option. Others may not have the contacts or agility to facilitate it.
5) The fundraise includes a "free" warrant with a strike price of 28.5p. I understand UK laws prevent ISA providers allowing investors to hold warrants in their ISA. I'd strongly suggest double checking with any provider who says they can accept it, to prevent the risk it later gets rejected.
6) It's been obvious for months that Agronomics needed to raise capital. They can't maintain their holdings in companies without participating in future fundraising rounds. To get it done at 22p, when the NAV was barely 6p (even if real value of assets was closer to 12p to 15p) is a fantastic deal for existing shareholders. The 2 year warrant at the 28.5p strike price takes away some of the upside, but could buy more time before Agronomics need to return to the market with another fundraising.
7) As a larger company, with a larger market cap, this will increasingly be on the radar of other fund managers = more incremental buyers.
8) For me, the only thing that takes the gloss off this fantastic investment opportunity is the RNS last week showing how Mellon has renegotiated his 15% performance fee to be even more in his favour. With the fundraise, the NAV probably increases to at least 11-12p (before his fees), but I think he now benefits from 15% of this rise on the new capital base. At least £3m+ in fees from this alone I think. And this 15% "Mellon tax" will effectively be the same on future performance and fundraisings. Let's hope he is worth it!