Yep my main point is that I think there is a hug chance the...

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Just_a_guy

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18/08/16

13:18

Post #: 18548820
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Originally posted by Sojourner ↑

Here's my take in a nutshell.

Reasons to buy:
- You believe the accelerated investment is a good idea and will bring forward growth and establish an insurmountable leadership position the markets ICQ operates in.
- You believe that the arrangements to raise capital will provide an opportunity to avoid significant dilution of your holdings (e.g. rights issue instead of an insto placement or a combo of both) AND you have sufficient cash on hand to participate in such an arrangement.

Reasons not to buy:
- You think competition is hotting up and increasing risks and accerlated investment is just a desperate gasp to maintain leadership in an increasingly competitive landscape that may not be successful
- You think they'll trump out the "speed and certainty" justification for a quick and dirty placement to the big end of town at very cheap prices, locking out little guys and massively diluting you.
- Even if they provide for retail holders to participate in a cap raise and avoid dilution, you don't have the money to spare or are unwilling to put anymore in for other reasons.

Just my opinion but I think the major shareholders in carsales and catcha group will not like getting diluted and put the kybosh to that happening which should hopefully give retail holders a chance to get a look into any cap raising so as to not get massively diluted.

My pie in the sky guess is that will be a combination of a placement with a rights issue, with holders able to subscribe for shortfalls (carsales might be wanting to use this part as an opportunity to increase holdings), and as a backstop for more certainty that they won't come up short, it will be fully underwritten.

Just to clarify, this is not investment advice and is based soley on my personal opinion and not any information provided by the company (they haven't even officially declared that there will be a cap raising yet). As usual, DYOR

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Yep my main point is that I think there is a hug chance the share price will drop to the placement price soon after (briefly) so why buy at this price. At the same time I've bought a small holding again this morning so as to potentially be involved if it's an spp rather than pro rata issue

ICQ Price at posting: 38.5¢ Sentiment: Sell Disclosure: Held
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0 Great analysis

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Yep my main point is that I think there is a hug chance the...

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