Tadtech, as you said, 'no advice is intended', but I get the...

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seaemay

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11/01/18

11:55

Post #: 30222419
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Originally posted by Tadtech ↑

The AIM listing will be no panacea in my view, the CAS float is being deemed by some as a funding of last resort as Aussie investors appetite for Crusader is poor due to past performance, they are trying to tap the London market therefore.

Has anyone here looked at the proposed AIM float issue price? It is based on what is known as a VWAP formula, basically an average price of currently issued shares over a period of time. This formula is dreaded by AIM investors, surprisingly there is no floor price in place either, that could suggest the advisers think the stock may go considerably lower.

VWAP allows entities to short the underlying stock (the current ASX issued shares) and buy back in a placing, or in the case of CAS the AIM share issue. I am not sure forward selling of CAS will occur but I would not put it past certain market entities. I would not personally be a buyer of Crusader until the VWAP price was fixed ahead of the listing.

In a nutshell existing CAS shareholders will be heavily diluted (as much as 50% potentially) by the AIM listing. The company wants to raise circa A$15m-A$20m but this will only fund so much, the real 'hit' will come from the circa A$100m needed to build a mine. I would not rule out further dilutive Capital Raises either, Corporate costs and overheads at Crusader are exceptionally high for a company of it's size in my opinion.

There is significant risk ahead, country risk, funding risk, political risk and project risk, many have failed in Brazil. I am not so sure the AIM float will be so successful therefore. Time will tell.

Good luck to all, remember this is only my opinion and no advice is intended.

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Tadtech, as you said, 'no advice is intended', but I get the feeling half a dozen holders have taken it anyway; hence the sell-down.

CAS Price at posting: 6.8¢ Sentiment: Hold Disclosure: Held
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Tadtech, as you said, 'no advice is intended', but I get the...

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