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Ann: Threat Protect Major Acquisition and $49m Funding Package, page-12

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40 Posts.

7

05/03/19

19:49

Post #: 37662430
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Originally posted by Biscuit4101: ↑

Hi dustfarmer, it is a little unusual for a raise to be at a premium to market price, but the rationale is sound.

Usually it happens when a buyer wants a large chunk of the equity in a thinly traded company (so they couldn't buy on market).

So in this case First Samuel are accumulating and need to pay a premium to get the volume they want.

Now the rights issue to ordinary holders could have been done as a requirement, because (I could be wrong here) you can't raise more than 15% of your equity through a private placement (you have to offer it to everyone). Given that FS have underwritten the rights issue, I would think that they are happy to get the $5m in addition to the $9m they have converted from debt and the $1m they picked up in January.

Hope that makes sense! Essentially the rights issue has to be at that price because thats what FS are paying, and the rights issue is essentially a quasi-sale of more equity to FS.

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I see, if FS bought online $ xxxxxx Mill

then the price of shares would have gone to $ 1.00.....so 25 would have been the cheaper premium...for them,

TPS Price at posting: 21.0¢ Sentiment: Buy Disclosure: Held
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