RE: General observation.25 Aug 2022 04:43
For anybody disgruntled with the placing share price, you need to take a step back and consider the circumstances.
1. SD was totally broadsided by the fact that NCM did not take up the 5% option, therefore providing us with an additional $60M towards capex funding. Yes other funding would still have been required, however, he may have been able to get this purely via bank debt.
2. In a fair and equitable world the SP should have re-rated from the 5% announcement by approx 20% (less the $60M), it did not due to the shorts being in control, and no buyers being present due to the phase of the project. The SP was in continuous decline until funding was secured.
SD has been able to implement this placing package in less than 5 days (just think about that). Thus avoiding further SP reduction and a lower placing price.
Yes, we would have all liked a higher placing price, but circumstances did not allow. He needed to act quickly, he did. All credit to him for that.
I would also like to highlight that the fact this is a selected II bookbuild only is a good thing. All of these new shares will be subject to restrictions, and unavailable for sale for 90 Days. This will hopefully take us past the FS, and any of the participating II's will be unlikely to sell after this.
People stating that the shorters will have an easy out are misguided. There will be no new shares available on the market for them to purchase, that is unless PI's decide to sell on this news. IMHO this is highly unlikely, in fact more are likely to use any reduction in the SP as an opportunity to top up.
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