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Mb. Cracking post as usual. Thankyou. I am glad we haven't got government finding, gives us a better bargaining position. As we have said many times before the funding will be used sensibly. The Ceo looks like he needs a couple of new shirts. He appears a man of means.
Atb.
Shweeeet.
Not dismissing your view, but I would much rather the government did not have a financial relationship on which they could influence how Omega conducts themselves.
I totally understand what you are saying, but I am very comfortable with the way they have structured finances and believe it will be very healthy for all concerned in the long run.
Upomega - last comment before i do some work - yeah we can sit here and say things could have been done differently. But the simple fact is this opportunity presented itself out of exceptional circumstances. Does it mean in the long run our value s going to be impacted.... probably not and it probably will work out better long term.
If it wasnt for Covid ODX would still be a decent business making progress with Food tolerance and CD4. But Covid has taken the company profile into a whole new league, and the ability to monetise from this opportunity is highly sought after. Unfortunately where there is great opportunity the City will want their share. You have a nomad who is also your broker who is also a market maker in the stock. Can't see them advising anything other than taking up the money that's been offered up. Unfortunately right or wrong, this is how it works, until you are making enough cash to not have to worry about it. Fortunately Omega will be filthy cash rich over the next two years, and the idea of a placing will be extinct.
Merchantbanker and legion
That is really what this is about. Government should have supplied all the necessary funding. Instead as merchant has said pi are taking all the risk only for gvmt when it suits them to say how supportive they have been in promoting the diagnostic industry. Maybe if omega renamed itself as rocheabbomegaazrbslloyds funds would be there. Maybe even throw in a airline owner in the process . The sad fact is someone like the baroness will be given another honor at the end of this
just hope that the share settles down after the cut off point and we steadily rise on the positive news flow in the coming months
The positive with raising funds through Equity is that the business is not saddled with debt and subject to interest payments.
Again this business has set its stall out, yes the risk is with investors, although the strategic plan is pretty damn robust and we are seeing the first few building blocks of great things coming through.
Senior employees have exercised share options, which signals they see good fortunes ahead too.
Roll on middle of July when the SP should start going North.
I think you do have some valid points. But tbh i think we have to suck it up and accept that although it might not be the best possible deal for us, it is very much a value adding fundraise and for me the production capacity is 4 x larger than what i'd hoped it to be without funding. For the £10.5m fundraise they have to put an itemised plan together. Don't expect every penny to be used exactly that way from day 1. But i do think development of new tests immediately is positive as they need to think about a pipeline 3-4 years down the line. They are a well run business financially and this keeps debt off of our balance sheet.
Personally what still pee's me off, is Pillar 5 of the government strategy is to grow the diagnostics industry. They will be bragging about it and Omega part of it but funded by PI money. I do find it difficult to believe that there wasnt a way to fund the business with the substantial cash flows forecast without equity dilution. But, £11m in the bank just means they are capitalised they dont have to worry about cutting corners and managing cash flow. Sometimes when a business grows as quickly as we are expecting cash can be problematic and that is now taken out of the equation. The equiptment is £4m to get to 2m capacity.
Upomega, you have to analyse the business as it is today, not how it used to be.
merchantbanker
This is my problem. As much as i like omega. This placing /open offer is not good. Take a look back as how they have raised funds in the past. Everything seems to have gone out of the window with this. Their cautious approach utilising bank o/d and institutions seems to be forgotton. Im afraid if they just end up with three milion then that should be fine . they could apply for grants over draft rolling credit etc. maybe even go back to oryx and raise a convertable. inmv anything better than have the share dictated by a load of traders day in day out.. only my opinion ,but as a holder which still anticipates holding not happy with the shenanagins here nowadays
Merchantbanker - No way they will vote against. Its to scale up production.
The SP is where it is because peeps have NOTHING, absolutely NOTHING to lose by selling their 5% at lets say 43p and re booking it at 40p on OO. They gain more shares so you can't blame them.
Upomega - if the second placing gets voted down then so does the OO i believe as the OO is conditional on the placing. Therefore Omega would only get £3m of the proposed £10.5m funding. Voting against will not be good for Omega IMO. Certain it will get voted through no problem.
20% dilution for a company with 4x the growth potential than without it isn't such a bad deal, although placing price was not where it should have been.
Thats not what the 3 milion is going for. It is to fund TB and Malaria on the cd4 platform. They dont need the funds for this. It is a long term development where cd4 sales can cover it
This is a world class medical product which will sell mega numbers around the world we either need vastly ramped up production which takes money or a JV with an international major pharma company ...take your pic but with the placing the stock is a HUGE buy for pis with foresight in my opinion £2 is conservative but we are going to have to wait gla
*******s upomega, you can't build out capacity with shirt buttons.....
One way to ensure that this regains its value is to vote at the agm to vote against the additional placing of 3 milion. Inmv it is not needed. The past week of share manipulation proves this more than ever
I think you are right legin, but it might take a few weeks...
Not sure with that one.
For me it is more to do with the mechanics of the placing and share offer. Once this has been processed and approved, the brakes will be off.
inmv the weakness in the price today is more to do with events in Hong Kong. Which could have a knock on effect for food tech in the short term