But the full value of the dilution is being carried within the...

But the full value of the dilution is being carried within the rights attached to the shares while its trading cum rights, so the share price should be the same as before the announcement until it goes ex rights.

ie

a company with $1.1 million cash in the bank and a $100,000 bank debt and nothing else.

Has issued capital of 1,000,000 shares. So each share is worth $1.

It decides to raise $100,000 to pay back bank debt with a 5 for 5 rights issue at 10 cents per share.
Cum rights the share price would still be $1.00

The value of each right would be 45 cents.

2,000,000 shares, $1.1 equity so 55 cents per share

each right is worth 45 cents because anyone would be willing to pay 55 cents (45+10) to own 55 cents worth of equity (pure cash in this case).

Pre rights, the share should still be at $1 (45 cent for the inherent value of the rights and 55 cents ex rights value of the share). Ex rights, the share should fall to 55 cents, reflecting the dilution. In the meantime everyone is still happy to take up their rights at 10 cents or sell the right on the market for 45 cents.

The question in Tanamis case is , was the 4.2 cent trading price last week overpriced based on speculation and is the 2.8 cents it fell to on the announcement more reflective of fair value?

I could be wrong, I just don't see where.