The market cap has nothing directly to do with funding. The market cap is a straight calculation of the number of shares issued multiplied by the mid share price i.e. 317.81m * £0.0338 = £10.73. Funding will only effect the market cap if receiving funding causes the share price to rise.
The reduction from a 10p to 0.5p share allows the raising of collateral by issuing more shares but issuing more share dilutes the value of the shares already owned. A double edged sword really as the share issue could save the company but any rises in sp will not be as great.
A company cannot raise funds through issuing new shares at a price lower than the original float price. The original float price was 10p, unlike most of the other small cap miners that float at 1p or even 0.5p. It suggests that they are about to issue millions more shares to raise capital that the financial institutions won't lend them.
Why is this share moving today ?
They're supposed to be starting production in Q4 2009 at an incredible $190 oz cost !
Currently stockpiling ore while awaiting completion of processing plant.
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