RE: RNS24 Sep 2020 15:27
Jsmith basically means this, copied from an earlier post...
Some one with some sense now
RE: AZs option purchaseToday 13:42
So as posted earlier but continued -
AZ/Orchestra group has just paid £1.1m to have the option (right not obligation) to buy 630m shares *IF* the SP is at or above 0.6945 on 31/12. So;
*IF* the SP is not at or above 0.6945, they cannot exercise the option; they loose £1.1m.
*IF* the SP is at or above 0.6945, they can buy the 630m shares @ 0.6945 which will cost £4,347,000 + £1.1m premium paid = £5,447,000 total for 630m (=0.86 per share)
So at the very least AZ confident the SP will be 0.86 (£5,447,000 / 630m) - as that is what 630m shares will cost (point above)
Why take this option and pay 1.1m for it. If at the time of exercising the option, lets say the SP is 1.2p, the profit/ additional worth of those shares would be £2,113,000 (630m @1.2 are worth £7,560,000 but through the option they cost / bought for £5,447,000)
Nice!
Any SP price at the time of exercising the option above 0.86 is bonus. The premium paid for option cost £1.1m.
Sounds like AZ / Avant confident where the share price will be at the end of the year if not sooner