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" And either an equity raise this year or once warrants are exercised will lead to dilution but could quite plausibly be mechanisms to provide some of this funding. "
iWantThatOne, you really are an optimist if you believe that the sp is likely to increase 10 fold this year. Because until it does AVO will not be raising any equity, and neither will anyone be cashing in any warrants. Certainly not while the nominal sp remains at 25p.
The funding requirement cannot wait until the sp rises back to 25p. The company will be broke long before that happens. Large and small share holders alike are blocked from helping, by participating in a Placing or Rights Issue. The board like Nero, who sat back and watched while Rome burned, did nothing as the share price crashed below its nominal value.
The share price was last at 25p on 9th Sept and has been in free fall ever since. Knowing that they would need to raise cash early in the year, the BoD should have had the sense to lower the nominal share price, to allow the people who believe in the company to help out. As they did not, they are now dependent on banks or other lenders to loan them the money they need to survive. Meanwhile rivals and other predators circle overhead like vultures.
LIGHT has a future. The same cannot be said for AVO at this moment.
"I meant the warrant holders will start to exercise once the sp rises above 25p."
iWantThatOne,
You were talking about raising money to keep the company going, not distant funding!
Without imminent new finance the company is very likely to collapse, rather than get back to 25p. I posted in December that the company needed a share reorganisation to lower the nominal share price. Until they do this they will not be able to issue any new shares, and no one will cash in any warrants.
That leaves them needing to borrow from banks who have so far shown little desire to invest in a company that has repeatedly failed to meet it's own targets. Without new funding insolvency beckons, with the administrators selling the company to a rival for a pittance. If this happens investors are likely to lose all, or most of their money.
" Btw, in case you didn’t know, everyone already expects dilution and isn’t particularly worried about it. An extra 200m shares at 25p brings in £50m. The 200m warrants will bring in £50m."
The warrants have an exercise price of 25p per share, almost 10 times more than the current share price. Why would anyone in their right mind pay 25p for these shares now?
And as for dilution, you are right not to worry about that, cos it ain't going to happen either. The company cannot issue new shares below 25p, so the number of shares in circulation is unlikely to grow any time soon.
Hi Lawrence,
I tired of the ignorant comments and abuse on this board, and stopped posting.
For the record I was not referring to you, Rusty or Freddie.
I sold about half of my shares between March and October 2021 at varying prices from 21p to 27p, taking a good profit, so did not suffer a massive hit when it all collapsed.
Good luck trying to recover any money you have lost here, although I fear that you are knocking your head against a brick wall. Write it off and move on, don't throw good money after bad on risky legal proceedings.
Hi Sotolo,
I can hold them in AJ Bell. The problem is that I cannot sell them.
Following a Corporate Action, my Aclara shares have been converted into Canadian paper certificates which are no longer tradable on CREST.
I would check that yours have not been converted, as most brokers will not touch paper shares, especially if listed on a foreign exchange.
You seriously want to buy shares in another Russian company, after what happened here?
IgorBelvoir'
Thanks for the tip re: Saxo.
Had a look - requires £500 deposit to open an account, and there are inactivity and FOREX charges to factor in, so may not be worth my while even if they do accept these paper shares. All I want to do is sell the bloody things!
I am seriously considering donating them to an international charity and be done with it.
Let me know if you do succeed with your transfer.
Hi,
I have unfortunately been left with some "untradeable"(according to AJ Bell) Aclara share certificates. They underwent a Corporate Action in November removing them from CREST, meaning that they cannot be traded electronically in the UK. The new Canadian paper shares are being held by an agent of AJ Bell. AJB's only advice is to open an account with someone who trades these shares and initiate a transfer to them, but they decline to name any brokers who may be able to help.
Does anybody know of a broker who will open an account for a UK resident, and accept these Canadian paper share certificates?
What AVO are building is way, way more complex than Sirius' mine, but the same rules of economics apply. If you run out of cash you are at the mercy of others, however good your product may be.
Failing companies usually attract predators rather than the hoped for knights in shining armour.
"and one or more of the global boys in this arena ,with deep pockets, to step up to the plate and benefit from what ostensibly should be an enormous future income stream."
Unfortunately this does not usually turn out well for shareholders!
Sirius Mining SXX ran out of money developing a large polyhalite mine in the North Yorkshire moors. There were vast deposits of this novel and very effective form of fertilizer.
Facing bankruptcy, the company was snapped up by Anglo American with a low take it or get nothing offer. Shareholders ( many locals) took a painful haircut. Having a great product does not guarantee success I am afraid.
As a post script Anglo American have also ran into financial problems developing the mine.
AVO cannot issue new shares at below their nominal value ie: 25p. That is why the shares are to be converted at that price, but as Tghussain has said AVO will make up the difference should the sp be lower. This can be paid in cash or in extra shares.
" If the Conversion Fee is to be paid in Ordinary Shares, it will be calculated as the difference in value between the conversion price and the nominal value multiplied by the closing share price on the conversion date and the multiple of the nominal value over the lowest closing share price during the period of the conversion date to the date before the transfer of the Ordinary Shares"
Please don't ask me to explain that!
Be very careful when reading Hardman articles. Hardman are not an independent research company, writing analytical reports for subscribing members. They write reports for companies who pay them to do so. And this is not the first time that AVO have commissioned a report from them.
Smileygareth,
I raised this issue on 30th Dec, as you will see if you scroll back. I can only advise on companies that I have dealt with, details below.
AJBell will only reclaim the tax on American and Canadian shares, so deduct the full 20% tax on PAF dividends.
HBOS & iWeb both automatically reclaim the tax for you, so pay the PAF dividends less 10% tax.
Interactive Investor will reclaim the tax on some markets, but do not specify which in their T&C's.